Microsoft Corp. (NASDAQ: MSFT) on Tuesday reported quarterly profit and revenue that topped analysts’ expectations, as the revenue from its cloud product Azure doubled in the quarter.
The technology company said that the revenue was $22.6 billion in the fiscal fourth-quarter, compared with revenue of $22.18 billion a year earlier. The result beat analysts’ estimate. Analysts polled by Thomson Reuters had projected revenue of $22.15 billion.
Excluding certain items, profit rose to 69 cents a share from 62 cents a year earlier, easily topping analysts’ estimates of 58 cents a share.
Microsoft shares jump more than 6 percent in the early trading.
The robust result was driven by strong growth in Microsoft Cloud business. Revenue from Azure, Microsoft’s corporate cloud platform, jumped 102 percent, or 108 percent in constant currency in the quarter ended June 30. Revenue from the entire cloud segment, the Intelligent Cloud Division, rose 6.6 percent to $6.7 billion, compared with the analysts’ estimate of $6.85 billion.
"The Microsoft Cloud is seeing significant customer momentum and we're well-positioned to reach new opportunities in the year ahead," Chief Executive Officer Satya Nadella said in a release.
Investors are optimistic on Mr. Nadella’s strategy of getting rid of phone business and focusing on Cloud business. revenue from the reporting segment that includes Windows and mobile phones fell 6.3% to $40.46 billion. Nadella has pull back the mobile-phone investments and the company could save $500 million and $800 million.
“It’s really important to focus on what’s growing and what’s falling,” Stifel analyst Brad Reback said. “Everything that matters grew and grew at a good clip.”