10-QPeriod: Q1 FY2019

MICROSOFT CORP Quarterly Report for Q1 Ended Sep 30, 2018

Filed October 24, 2018For Securities:MSFT

Summary

Microsoft Corporation's 10-Q filing for the period ending September 29, 2018, reveals a strong financial performance driven by continued growth across its key segments. The company demonstrated robust revenue generation and profitability, underscoring its strategic execution in cloud computing, productivity software, and personal computing. Investors can take comfort in the company's sustained operational efficiency and its ongoing investments in innovation, which position it well for future growth. Key financial metrics presented in the filing indicate healthy top-line growth and a solid bottom line. The company's diversified business model continues to be a significant strength, allowing it to navigate market dynamics effectively. The report details the company's financial condition, results of operations, and liquidity, providing a comprehensive overview of its fiscal health and operational strategy.

Financial Highlights

53 data points
Beta

Revenue

$29.08B

65.9% Gross Margin

Net Income

$8.82B

30.3% Net Margin

EPS (Diluted)

$1.14

Total Assets

$257.62B

Cash & Equivalents

$15.14B

Free Cash Flow

$10.05B

Financial Statements
Beta
Revenue$29.08B
Cost of Revenue$9.90B
Gross Profit$19.18B
R&D Expenses$3.98B
Operating Income$9.96B
Interest Expense$674.00M
Net Income$8.82B
EPS (Basic)$1.15
EPS (Diluted)$1.14
Shares Outstanding (Basic)7.67B
Shares Outstanding (Diluted)7.77B

Key Highlights

  • 1Continued robust revenue growth across Microsoft's major business segments, particularly in cloud services (Intelligent Cloud and Productivity and Business Processes).
  • 2Strong profitability metrics, indicating effective cost management and operational efficiency.
  • 3Significant cash flow generation, providing financial flexibility for investments, dividends, and share repurchases.
  • 4Expansion of cloud computing offerings and market share, a key driver of future growth.
  • 5Performance of the Productivity and Business Processes segment, likely driven by Office 365 subscriptions and LinkedIn.
  • 6Trends in the Personal Computing segment, including performance of Windows and Surface devices, indicating market reception and competitive positioning.
  • 7Details on the company's financial condition, including assets, liabilities, and equity, reflecting a healthy balance sheet.

Frequently Asked Questions

Revenue growth was primarily driven by the continued expansion of Microsoft's cloud computing services, including Azure and Office 365, alongside strong performance in the Productivity and Business Processes segment, which includes LinkedIn.

The Intelligent Cloud segment, encompassing Azure and server products, showed significant growth. The Productivity and Business Processes segment also demonstrated strength, largely attributed to the increasing adoption of Office 365 commercial and business services.

Microsoft generated substantial cash flow from operations during the quarter. This strong cash position provides the company with flexibility to invest in research and development, pursue strategic acquisitions, return capital to shareholders through dividends and share repurchases, and maintain its financial stability.

The filing includes sections on Legal Proceedings and Risk Factors. Investors should review these sections for specific details on potential legal challenges and the broader risks that could impact Microsoft's business operations and financial performance.