Microsoft Revenues Jumped 13 Percent in FY24 Q1
- Paul Thurrott
- Oct 24, 2023
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Microsoft announced that it earned a net income of $22.3 billion on revenues of $56.5 billion in the quarter ending September 30, 2023. Those figures are up 27 percent and 13 percent, respectively, year-over-year (YOY).
“With copilots, we are making the age of AI real for people and businesses everywhere,” Microsoft CEO Satya Nadella said, referring to a product that isn’t even available yet and did not impact the quarter. “We are rapidly infusing AI across every layer of the tech stack and for every role and business process to drive productivity gains for our customers.”
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Microsoft’s Intelligent Cloud business was once again its biggest in the quarter, but it was also its fastest-growing business with $24.3 billion in revenues, up 19 percent YOY. Azure and other cloud services revenue jumped 29 percent, while Server products and cloud services revenue grew by 21 percent. Microsoft also noted that the installed base of its Enterprise Mobility offering grew 11 percent YOY to over 259 million seats.
Productivity and Business Processes contributed another $18.6 billion in revenues, up 13 percent YOY. Office commercial saw revenue growth of 18 percent in the quarter, with Office 365 commercial revenue up 18 percent. Office consumer revenues were up 3 percent, with the subscriber base growing 18 percent to 76.7 million.
And More Personal Computing once again brought up the rear, with $13.7 billion in revenues and growth of just 3 percent. Windows revenues from PC makers grew 4 percent, which may be a positive sign for future PC market growth. Device (read: Surface) revenues declined 22 percent. Gaming revenue was up 8 percent, with Xbox content and services up 13 percent and Xbox hardware revenues down 7 percent. And Search and news ad revenues were up 10 percent, assuming you ignore the “traffic acquisition costs” that Microsoft did not specify.
Microsoft addressed the impact of the Activision acquisition during its post-earnings conference call, so I’ll be writing up an analysis of that in the morning.