Microsoft’s latest financial results, those for Q1 FY22 (July – August 2021) are in and – as has been the case for the recent memory – they smashed it again.
Revenue for the quarter was $45.3 billion – a year-on-year increase of 22% and operating income was up 27% to $20.2 billion.
The overall “Microsoft Cloud” area broke $20 billion quarterly revenue for the first time with growth of 36% to reach $20.7 billion. However, Microsoft Cloud gross margin did drop slightly to a mere 71%!
During the earnings call, Satya Nadella said:
“Digital technology is a deflationary force in an inflationary economy”
Which helps explain why the cloud, and technology like Power Platform, keeps growing…they’re helping level the playing field and help smaller organisations grow and compete.
Productivity & Business Processes
This division was up 22% to $15 billion for the quarter, driven by growth in various elements:
- Office 365 Commercial was up 23%
- LinkedIn was up 42%
- Dynamics 365 was up 48%
This is strong growth in several key areas for Microsoft and they don’t believe it will slow down next quarter either.
Revenue here was $17 billion driven by Azure growth of 50%. The rise of Azure doesn’t seem to be slowing down!
More Personal Computing
Windows OEM was up 10%, despite the ongoing supply chain issues for PCs and laptops…but Surface was down 17%. This is perhaps due to the constraint issues impacting more on higher end devices at the moment.
Other areas of interest
There were various additional statements made during the earnings call including:
- Power Platform reaches almost 20 million monthly active users (MAU) – up 76% year-on-year (YoY). Of that, Power Apps makes up 10 million MAU and grew 202% YoY…Nadella states it is in use within 91% of the Fortune 500.
- Satya Nadella made several references to the size of organisations that are using products such as Power Platform and Teams – pointing out how many 10,000+ and 100,000+ user organisations are customers.
- Microsoft now have over 650,000 customers using their security solutions. How many of those are using more than Defender in Windows 10 would be interesting to see…
- Office Commercial licensing decreased by 13%, continuing Microsoft’s ongoing transition of their customer base from on-prem to cloud.
- Enterprise Mobility + Security is now at 196 million seats.
- Amy Hood revealed that Microsoft have increased headcount by 14% YoY, which is a pretty significant hiring drive.