Microsoft shares its latest quarterly earnings in a new report

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Key notes

  • Curious about Microsoft's latest financial report for the last fiscal quarter?
  • The tech giant published its quarterly earnings and we are here to share.
  • Even considering unforeseen situations, the company reports strong numbers.

We know that many of you are wondering what kind of numbers Microsoft makes of all its products and, as always, we’re here to shed some light on the matter.

As you are probably used to by now, the tech colossus has posted strong figures for the last quarter of the 2022 fiscal year as it looks forward to starting the 2023 fiscal year.

Just so there is absolutely no confusion, keep in mind that the company’s 2022 fiscal year ended on June 30th, 2022.

Microsoft reports $51.9 billion in revenue this last quarter

So, since we’re talking money, let’s discuss the fact that, in its latest quarter, Microsoft’s revenue was $51.9 billion, which is a 12% increase (16% Constant Currency) compared to the same period in the previous fiscal year.

The operating income entry had only a single-digit growth of 8% (14% CC), which amounts to a staggering $20.5 billion.

As far as net income goes, it increased by 2% (7% CC) to $16.7 billion and diluted earnings per share were $2.23, up by 3% (8% CC).

Keep in mind that, while all of these are positive figures, the Redmond-based tech company has also highlighted some unfavorable global and macroeconomic conditions that negatively impacted its results.

These are totally unforeseen circumstances that the tech company did not bring up in its forward-looking statements published in April 2022 whatsoever.

Thus, the Redmond giant has announced that unfavorable foreign exchange rates negatively affected revenue and diluted earnings per share by $595 million and $0.04, respectively.

As a result of an overall reduction in advertising spending, LinkedIn took a massive impact, with Search and news advertising revenue decreasing by $100 million.

Microsoft also mentions extended production shutdowns in China which, with the deterioration in the PC market in June, led to a decline of $300 million in Windows OEM revenue.

Microsoft is known to have also scaled down its operations in Russia, which means that the tech giant posted operating expenses of $126 million in lieu of bad debts, asset impairments, and severance packages.

Even outside of Russia, the realignment of its business groups across the globe resulted in employee severance payments of $113 million.

Moving on, Microsoft also posted the quarterly Productivity and Business Processes revenue, which stood strong at $16.6 billion, going up in percentage by 13%.

The company explains that this was powered by significant growth in revenue for Office Commercial products (9%), Office 365 Commercial (15%), Office Consumer products (9%), LinkedIn (26%), Dynamics products (19%), and Dynamics 365 (31%).

Another interesting fact about growth, since we’re on the subject, is that Microsoft 365 subscribers also grew to 59.7 million people, which is a lot.

Intelligent Cloud revenue was at $20.9 billion, which constitutes a giant growth of 20%, due to Server products growth (22%) and Azure (40%).

As for revenue in the More Personal Computing category, while overall revenue grew by 2% and stood at $14.4 billion, Windows OEM revenue declined by 2% and Xbox content and services were down by 6%.

Also, note that Windows Commercial products grew by 6% and Surface revenue was up by 10%, as reported by Microsoft.

Drawing the line for the fiscal year 2022, revenue was at $198.3 billion (18% growth), operating income was $83.4 billion (19%), net income was $72.7 billion GAAP (19%), $69.4 billion non-GAAP (15%), diluted earnings per share was $9.65 GAAP (20%), and $9.21 non-GAAP (16%).

Going into the new fiscal year, Microsoft has set some target objectives that it plans to stick to, as follows:

  • intense competition in all of our markets that may lead to lower revenue or operating margins;
  • increasing focus on cloud-based services presenting execution and competitive risks;
  • significant investments in products and services that may not achieve expected returns;
  • acquisitions, joint ventures, and strategic alliances that may have an adverse effect on our business;
  • impairment of goodwill or amortizable intangible assets causing a significant charge to earnings;
  • cyberattacks and security vulnerabilities that could lead to reduced revenue, increased costs, liability claims, or harm to our reputation or competitive position;
  • disclosure and misuse of personal data that could cause liability and harm to our reputation;
  • the possibility that we may not be able to protect information stored in our products and services from use by others;
  • abuse of our advertising or social platforms that may harm our reputation or user engagement;
  • the development of the internet of things presenting security, privacy, and execution risks;
  • issues about the use of artificial intelligence in our offerings that may result in competitive harm, legal liability, or reputational harm;
  • excessive outages, data losses, and disruptions of our online services if we fail to maintain an adequate operations infrastructure;
  • quality or supply problems;
  • government litigation and regulatory activity relating to competition rules that may limit how we design and market our products;
  • potential consequences under trade, anti-corruption, and other laws resulting from our global operations;
  • laws and regulations relating to the handling of personal data that may impede the adoption of our services or result in increased costs, legal claims, fines, or reputational damage;
  • claims against us that may result in adverse outcomes in legal disputes;
  • uncertainties relating to our business with government customers;
  • additional tax liabilities;
  • the possibility that we may fail to protect our source code;
  • legal changes, our evolving business model, piracy, and other factors may decrease the value of our intellectual property;
  • claims that Microsoft has infringed the intellectual property rights of others;
  • damage to our reputation or our brands that may harm our business and operating results;
  • adverse economic or market conditions that may harm our business;
  • catastrophic events or geo-political conditions, such as the COVID-19 pandemic, that may disrupt our business;
  • exposure to increased economic and operational uncertainties from operating a global business, including the effects of foreign currency exchange and
  • the dependence of our business on our ability to attract and retain talented employees.

What are your thoughts on Microsoft’s latest revenue report? Share your opinions with us in the comments section below.

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