Summary
Microsoft Corporation (MSFT) reported strong financial results for the quarter and six months ended December 31, 2020. Total revenue increased significantly year-over-year, driven by robust performance across all reporting segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The Intelligent Cloud segment, in particular, showed substantial growth, primarily fueled by Azure's impressive expansion. The Productivity and Business Processes segment also saw solid gains, benefiting from Office 365 Commercial and LinkedIn's performance. More Personal Computing delivered increased revenue, with Gaming being a key growth driver, boosted by new console launches. The company's commercial cloud revenue experienced a significant surge, underscoring its strategic focus on cloud services. Profitability also saw a notable improvement, with operating income and diluted earnings per share showing strong year-over-year increases. This was supported by higher gross margins, partly due to a change in accounting estimate for server and network equipment's useful life, which positively impacted operating and net income. Microsoft continues to return capital to shareholders through share repurchases and dividends, demonstrating its commitment to shareholder value.
Financial Highlights
53 data points| Revenue | $43.08B |
| Cost of Revenue | $14.19B |
| Gross Profit | $28.88B |
| R&D Expenses | $4.90B |
| Operating Income | $17.90B |
| Interest Expense | $571.00M |
| Net Income | $15.46B |
| EPS (Basic) | $2.05 |
| EPS (Diluted) | $2.03 |
| Shares Outstanding (Basic) | 7.55B |
| Shares Outstanding (Diluted) | 7.62B |
Key Highlights
- 1Total revenue for the six months ended December 31, 2020, increased by 15% to $80.23 billion compared to the prior year.
- 2Intelligent Cloud segment revenue grew 21% year-over-year to $27.59 billion for the six months ended December 31, 2020, with Azure revenue increasing by 49%.
- 3Productivity and Business Processes segment revenue increased by 12% to $25.67 billion for the six months ended December 31, 2020, driven by Office Commercial and LinkedIn.
- 4More Personal Computing segment revenue rose 11% year-over-year to $26.97 billion for the six months ended December 31, 2020, with Gaming revenue up 38%.
- 5Diluted earnings per share increased by 33% to $3.85 for the six months ended December 31, 2020, compared to the prior year.
- 6Commercial cloud revenue reached $31.9 billion for the six months ended December 31, 2020, a significant increase from $24.1 billion in the prior year.
- 7The company repurchased $11.0 billion in shares and paid $8.5 billion in dividends during the six months ended December 31, 2020.