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Microsoft Corp. (MSFT) Posts Q4 EPS of 55c; Revs Top Expectations

July 22, 2014 4:04 PM EDT

(Updated - July 22, 2014 4:05 PM EDT)

Microsoft Corp. (NASDAQ: MSFT) reported Q4 EPS of $0.55, versus the analyst estimate of $0.61. Revenue for the quarter came in at $23.38 billion versus the consensus estimate of $23.11 billion.

“We are galvanized around our core as a productivity and platform company for the mobile-first and cloud-first world, and we are driving growth with disciplined decisions, bold innovation, and focused execution,” said Satya Nadella, chief executive officer of Microsoft. “I’m proud that our aggressive move to the cloud is paying off – our commercial cloud revenue doubled again this year to a $4.4 billion annual run rate.”

“Our solid execution and expense discipline allowed us to deliver a strong finish to the fiscal year,” said Amy Hood, executive vice president and chief financial officer at Microsoft. “As we enter fiscal 2015, we are focused on aligning our resources to strategic investments that we believe will deliver the next wave of innovation, growth, and long-term shareholder value.”

Three Months Ended June 30,

($ in millions, except per share amounts)

Revenue

Gross Margin

Operating Income

Diluted EPS

2013 As Reported (GAAP)

$19,896

$14,294

$6,073

$0.59

Office Upgrade Offer

$(782)

$(782)

$(782)

$(0.07)

2013 As Adjusted (Non-GAAP)

$19,114

$13,512

$5,291

$0.52

2014 As Reported (GAAP)¹

$23,382

$15,787

$6,482

$0.55

%Y/Y (GAAP)

18%

10%

7%

(7)%

%Y/Y (Non-GAAP)

22%

17%

23%

6%

¹Fiscal year 2014 includes the results of the NDS business for the period beginning on April 25, 2014.

Devices and Consumer revenue grew 42% to $10.00 billion, with the following business highlights:

· Windows OEM revenue grew 3%, driven by 11% growth in Windows OEM Pro revenue.

· Office 365 Home and Personal subscribers totaled more than 5.6 million, adding more than 1 million subscribers again this quarter.

· The acquired Phone Hardware business contributed $1.99 billion to current year revenue.

· Bing search advertising revenue grew 40%, and U.S. search share grew to 19.2%.

Commercial revenue grew 11% to $13.48 billion, with the following business highlights:

· Commercial cloud revenue grew 147% with an annualized run rate that exceeds $4.4 billion.

· Windows volume licensing revenue grew 11%.

· Server products revenue, including Azure, grew 16%, with double-digit growth for SQL Server and System Center.

“Our results reflect our customers’ long-term commitments to our products and services, and strong execution by our field teams. We are thrilled with the tremendous momentum of our cloud offerings with Office 365 and Azure both growing over 100% again,” said Kevin Turner, chief operating officer at Microsoft. “Looking forward, we are excited by the amazing opportunities enabled by our technology roadmap and our strong engagement across partners, customers, and developers.”

For earnings history and earnings-related data on Microsoft Corp. (MSFT) click here.



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