Financeupdated 54m ago2 min read
Microsoft Revenue Jumps 19% To $92.3B As Azure Surges 48%
“Microsoft generated $10 billion in revenue from commercial arrangements with OpenAI”
“Microsoft Cloud revenue reached $63.9 billion, up 30% year-on-year, while revenue from its Azure cloud computing platform surged 48%”
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Microsoft revenue rose 19% year over year to $92.3 billion. Azure revenue surged 48%, driving the cloud performance.
Azure fuels results
Microsoft reported revenue of $92.3 billion for the July-September quarter, up 19% year-on-year, and net income of $36.6 billion, up 32%, as the company said its cloud computing business drove the gains. Microsoft Chief Financial Officer Amy Hood said, "We delivered a strong start to the fiscal year with Microsoft Cloud revenue of $63.9 billion," and she added that growth accelerated to 30% year-over-year. Microsoft Chairman and CEO Satya Nadella said, "We are delivering greater capability, choice, control, and cost efficiency for customers across our entire stack," as the company tied the quarter to expanding adoption.
Microsoft said its Microsoft Cloud revenue reached $63.9 billion, up 30% year-on-year, while Azure revenue surged 48%, and the company reported operating income climbed 21% to $45.9 billion. Microsoft also said it returned $10.2 billion to shareholders through dividends and share repurchases during the quarter.
Financing and demand
Microsoft financed its data-center spending from its own operations and even repaid $4.85 billion of debt in the quarter, while the company also spent $45.2 billion including leasing contracts. Microsoft expected more than $96 billion in the current quarter, and Hood welcomed even faster Azure growth for the current quarter, at least 49%. Microsoft no longer ruled out borrowing, even as its online computing accelerated between July and September without taking on debt.
Satya Nadella said Microsoft added 24 new data centers across five continents this quarter, and he described the move as a response to demand. France 24 also reported that Microsoft no longer ruled out borrowing, even as it said its online computing accelerated between July and September without taking on debt.
OpenAI ties and stakes
Microsoft said it generated $10 billion in revenue from commercial arrangements with OpenAI, including revenue-sharing payments, for the quarter ended September 30, according to a regulatory filing. TechCrunch reported that Microsoft’s $10 billion figure represented nearly 11% of Microsoft’s total quarterly revenue of $92.3 billion, underscoring the financial ties between the companies. Microsoft reported $7.2 billion in outstanding receivables from OpenAI at the end of September, up from $6 billion at the end of June.
Anadolu Ajansı said Microsoft’s results excluded the impact of investments in OpenAI, with adjusted net income rising 18% to $36.4 billion, while adjusted earnings per share increased 18% to $4.89. France 24 said Microsoft’s weakness remained its dependence on OpenAI, in which it holds about 27%, and it said commitments weighed nearly half of its order backlog at the start of the year.