The financial results for Microsoft's second fiscal quarter, which ended December 31, paint a mixed picture of the company's businesses. Overall revenue hit $26.5 billion, up 8% over the same period last year. However, net income declined 10.6% to a still-respectable $5.9 billion. Here are the relevant figures, which include $243 million in "integration and restructuring expenses" related to the Nokia acquisition and the job cuts announced in July.
|Revenue||$26.5 billion||$24.5 billion||up 8.0%|
|Gross margin||$16.3 billion||$16.2 billion||up 0.8%|
|Operating income||$7.8 billion||$8.0 billion||down 2.4%|
|Net income||$5.9 billion||$6.6 billion||down 10.6%|
The Devices and Consumer division contributed $12.9 billion in revenue, an 8% increase year-over-year. $1.1 billion of that came from sales of Surface devices and accessories, which rose 24%. That jump is largely attributed to the Surface Pro 3.
Revenue from OEM Windows licensing took a big hit, falling 13% for both Pro and non-Pro flavors. Microsoft blames the decline on a "[return] to pre-Windows XP end of support levels," discounts for academic customers, and "license growth from opening price point devices." Thanks to incentives, Windows is essentially free—or nearly free—on smaller tablets and some other low-end devices.
A lot of folks with entry-level Windows devices probably got a free year of Office 365, which explains why subscriptions increased 30% to 9.2 million. Office 365, Azure, and Dynamic CRM Online combined to fuel a 114% increase in commercial cloud revenue, bringing that business segment's "annualized revenue run rate" to $5.5 billion.
|Report: Samsung 970 and 980 NVMe SSDs are on the way||24|
|MSI's Aegis 3 compact gaming PC reviewed||18|
|EK-Kit S140 and S280 make liquid cooling simple||5|
|Huawei Mate 10 and Mate 10 Pro go big on cameras and AI||24|
|WPA2 security hole KRACKs Wi-Fi networks wide open||64|
|Qualcomm seeks to block iPhone sales and manufacturing in China||24|
|Pimax's 8K VR headsets could be a look into the next generation||20|
|TPCast wireless VR kit lets Oculus Rift owners roam free||16|
|NEC PA243W has all the colors in the rainbow and then some||7|