Microsoft cloud revenues rise as phones plunge in its fiscal Q2

Microsoft has released its earnings numbers for the second quarter of its fiscal 2016. The company took in $23.8 billion in revenue, $6 billion in operating income, and $5 billion in net income for the quarter. Revenue fell 10% compared to this time a year ago, while operating income fell 23% and net income fell 15%.

Those numbers may look bad at first, but it appears Apple isn't the only company frustrated by the weakness of foreign currencies against the US dollar right now. In constant currency terms (removing the effects of foreign exchange rates), Microsoft says it actually grew revenue 3% year-over-year, while operating income was up 13% and net income was up 20% by the same measure.

That theme continues as we look at the results of Microsoft's business divisions. The company's Productivity and Business Processes group, responsible for applications like Office 365 and Dynamics CRM, took in $6.7 billion, down 2% year-over-year in Generally Accepted Accounting Principles (GAAP) terms but up 5% in constant currency.

Intelligent Cloud revenue grew to $6.3 billion, up 5% in GAAP terms or 11% in constant currency. That division is the home of services like Windows Azure and products for servers and cloud computing. The company says its Azure revenue grew 140% overall in constant currency, while its Azure premium services revenue tripled compared to this time last year.

The company's More Personal Computing revenue shrank 5% (2% in constant currency) to $12.7 billion. Windows OEM revenue fell by 5% year-over-year, while Surface revenue increased 29%. Microsoft's phone revenue fell a whopping 49% in constant currency, though.

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