Cloud Computing Helps Power Microsoft Earnings

By Jay Greene 

Once written off as a tech has-been, Microsoft Corp. continued its rebirth as a force in cloud-computing, posting double-digit gains in its business selling web-based services to corporate customers.

The venerable software giant has solidified its spot as the No. 2 provider of on-demand computing processing and storage behind market pioneer Amazon.com Inc. In its fiscal fourth quarter, Microsoft notched gains in its Azure cloud-computing business and Office 365, the online version of its widely used productivity software.

Revenue from the Redmond, Wash., company's Intelligent Cloud segment, which includes Azure, rose 11% to $7.4 billion. In the Productivity and Business Processes segment, which includes the Office franchise, revenue climbed 21% to $8.4 billion.

Microsoft doesn't disclose revenue figures for its Azure and Office 365 businesses, but it said Azure revenue jumped 97% and Office 365 revenue rose 43%.

Overall, Microsoft posted $6.51 billion in fourth-quarter net income, or 83 cents a share, compared with a profit of $3.12 billion, or 39 cents a share, a year ago. Excluding the impact of revenue deferrals and other items, adjusted earnings climbed to 98 cents from 69 cents a year earlier.

Revenue rose 13% to $23.32 billion and was $24.7 billion when adjusted to reflect Windows 10 revenue deferrals.

Analysts surveyed by S&P Global Market Intelligence expected Microsoft to report adjusted per-share earnings of 71 cents on $24.29 billion in adjusted revenue.

Shares rose 1.5% to $75 in after-hours trading after results beat expectations. The software giant's shares closed at a record on Thursday, after setting its previous high a day earlier.

Write to Jay Greene at [e-mail]

(END) Dow Jones Newswires

July 20, 2017 16:53 ET (20:53 GMT)

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