Microsoft Q1 up 15% – unaffected by virus

Author: EIS Release Date: May 19, 2020

Announcing Q1 revenues up 15% y-o-y for a net profit up 22% y-o-y of  $10.8 billion, Microsoft said: “COVID-19 had minimal net impact on the total company revenue.”

‘In the Productivity and Business Processes and Intelligent Cloud segments, cloud usage increased, particularly in Microsoft 365 including Teams, Azure, Windows Virtual Desktop, advanced security solutions, and Power Platform, as customers shifted to work and learn from home,’ said Microsoft, ‘in the final weeks of the quarter, there was a slowdown in transactional licensing, particularly in small and medium businesses, and a reduction in advertising spend in LinkedIn.’

‘In the More Personal Computing segment, Windows OEM and Surface benefited from increased demand to support remote work and learn scenarios, offset in part by supply chain constraints in China that improved late in the quarter,’ added Microsoft, ‘gaming benefited from increased engagement following stay-at-home guidelines. Search was negatively impacted by reductions in advertising spend, particularly in the industries most impacted by COVID-19. The effects of COVID-19 may not be fully reflected in the financial results until future periods.’

Productivity and Business Process which includes Office, LinkedIn, and Dynamics had revenues of $11.7bn, up 15% y-o-y.

Intelligent Cloud revenues (Azure and Enterprise Services) had revenues of $12.3bn, up 27% y-o-y.

Microsoft had indicated just the other week that demand for its cloud-based services was rather high.

The More Personal Computing business (Xbox and Windows) had revenues of $11bn, up 3% y-o-y.

“From remote teamwork and learning, to sales and customer service, to critical cloud infrastructure and security – we are working alongside customers every day to help them adapt and stay open for business in a world of remote everything,” said CEO Satya Nadella (pictured).