Microsoft reported a profit of about $18.76 billion in the period prior to the $15.4 billion drop in the same period in 2020, Adjusted earnings for “Microsoft” (when excluding some items) was about $2.48 per share, while expectations were to record adjusted earnings of about $2.31 per share.
As for revenues, they jumped, recording $51.73 billion in the three months ending on December 31, exceeding expectations that had indicated that it would achieve revenue of about $50.88 billion, after revenues of about $43.1 billion in the same period in 2020.
Microsoft’s revenue from cloud computing services amounted to $ 18.33 billion in the fourth quarter of last year, from $ 14.6 billion in the same period a year ago, while analysts expected to record revenue from these services about $ 18.31 billion.
The American software company stated that its revenues from personal computing, which includes “Windows” systems, devices and games, amounted to about 17.47 billion dollars in the last quarter of 2021, compared to about 15.12 billion dollars a year ago.
Sales of Office 365 to business customers rose 19%, and revenue from Windows operating-system software sold to PC makers increased 25%. Sales of Xbox machines climbed 4% compared with the year-earlier holiday period, when the new versions of the devices launched but supply was severely limited. Revenue from Xbox content and services jumped 10% in the recent period.
Last week, Microsoft unveiled a deal to acquire Activision Blizzard for $68.7 billion, acquiring a legendary game publisher responsible for franchises like Call of Duty and World of Warcraft, but recently roiled by claims of sexual misconduct and discrimination.
Commercial cloud sales in the quarter rose 32% to $22.1 billion, Microsoft said. Gross margin, or the percentage of sales left after subtracting production costs, in that business narrowed slightly to 70%, the company said in a slide posted on its website. Without the impact of an accounting change, gross margin would have widened by 3 percentage points.
Microsoft shares dropped about 5% in extended trading following the report, after declining 2.7% to $288.49 at the close in New York. While the stock jumped 51% in 2021, it has fallen 14% so far this year amid a rout in large technology stocks.