1.3% despite Q2 beats, 98% Azure growth

The biggest victor this quarter was Microsoft's Productivity and Business Processes segment, which includes Microsoft Office, the Office 365 cloud suite, and the LinkedIn social network.

The company says that Azure revenue climbed 98% during the quarter which again shows that the company's cloud platform is the future of the organization. This was the 10th consecutive quarter of 90%+ revenue growth for Azure.

Q2 revenue: $28.92 billion, compared to Wall Street's expectation of $28.4 billion in revenue. The results also included a net charge of $13.8 billion related to the Tax Cuts and Jobs Act. Wall Street has been modeling Microsoft to earn 79 cents a share, up 8% year over year, on sales of $25.42 billion, according to Zacks. Analysts expected Microsoft to post earnings of 86 cents per share on $28.39 billion in revenue. It's clear Microsoft's future growth and revenue opportunities are with the cloud, so it's no surprise to see the company continually investing there to be competitive with Amazon.

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In particular, Microsoft said that its Azure revenue grew 98% year-over-year - a long-running theme alongside many other lines that equate to Microsoft's efforts in the cloud offsetting numerous major shifts in computing that first led Microsoft to be a behemoth. Surface revenue was relatively flat, at 1%, which is surprising as I would have thought the Surface Laptop and Book 2 would have helped sales this year but that does not appear to be the case. LinkedIn revenue was $1.3 billion. Surface revenue was flat in constant currency.

Microsoft stock, which is closing in on the $100 per share mark, is down slightly following the company's latest financials.

Microsoft will now hold an earnings call at 5:30PM ET / 2:30PM PT, and we'll update this article with any relevant information.

(Copyright © 2015. All Rights Reserved.)
 
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