Summary
Microsoft Corporation reported strong financial results for the third quarter and the first nine months of fiscal year 2020, ending March 31, 2020. Total revenue for the quarter increased by 15% to $35.02 billion, and for the nine-month period, it grew by 14% to $104.98 billion. Net income also saw significant year-over-year growth, up 22% for the quarter to $10.75 billion and 27% for the nine months to $33.08 billion. This performance was driven by robust growth across all three segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing, with notable acceleration in cloud services, particularly Azure, which grew 59% for the quarter. The company demonstrated strong operational efficiency, with gross margin increasing by 18% for the quarter and 19% for the nine months, leading to a 25% and 29% increase in operating income, respectively. Microsoft also continued to return significant capital to shareholders through share repurchases and dividends, underscoring its financial strength and commitment to shareholder value. The report also addresses the nascent impacts of the COVID-19 pandemic, noting minimal net impact on revenue in the current quarter, with some cloud usage benefits offset by slowdowns in transactional licensing and advertising spend.
Financial Highlights
53 data points| Revenue | $35.02B |
| Cost of Revenue | $10.97B |
| Gross Profit | $24.05B |
| R&D Expenses | $4.89B |
| Operating Income | $12.97B |
| Interest Expense | $614.00M |
| Net Income | $10.75B |
| EPS (Basic) | $1.41 |
| EPS (Diluted) | $1.40 |
| Shares Outstanding (Basic) | 7.60B |
| Shares Outstanding (Diluted) | 7.67B |
Key Highlights
- 1Total revenue for the three months ended March 31, 2020, increased 15% year-over-year to $35.02 billion.
- 2Net income for the three months ended March 31, 2020, increased 22% year-over-year to $10.75 billion, resulting in diluted EPS of $1.40.
- 3Intelligent Cloud segment revenue grew 27% to $12.28 billion for the quarter, driven by a 30% increase in server products and cloud services, with Azure revenue up 59%.
- 4Productivity and Business Processes segment revenue increased 15% to $11.74 billion, fueled by Office Commercial (up 13%) and LinkedIn (up 21%).
- 5More Personal Computing segment revenue grew 3% to $10.99 billion, with Windows revenue up 6% and Surface revenue up 1%.
- 6Commercial cloud revenue increased 39% to $13.3 billion for the quarter.
- 7The company returned $9.9 billion to shareholders through share repurchases and dividends in the third quarter of fiscal year 2020.