Microsoft FY22 Q3 earnings: $49.4 billion revenue exceeds expectations

Microsoft beat expectations in FY22 Q3, in large part due to strong figures from its Intelligent Cloud and Personal Computing sectors.

What you need to know

Microsoft just released its FY22 Q3 earnings report.
The company brought in $49.4 billion in revenue during the quarter, which is an increase of 19%.
Microsoft’s net income was $16.7 billion, which is an increase of 8% GAAP.
Windows Commerical products and cloud services revenue increased 14% year-over-year.

Microsoft just released its earnings report for FY22 Q3 (the third quarter of the 2022 fiscal year). The company saw an overall revenue increase of $49.4 billion (19% YoY) and a net income increase of $16.7 billion (8% GAAP). Microsoft’s overall revenue of $49.4 billion beat the expectation of $49.05 billion, according to Refinitiv (via CNBC).

Here are some of the biggest highlights of the report:

Revenue was $49.4 billion and increased 18%
Operating income was $20.4 billion and increased 19%
Net income was $16.7 billion and increased 8% GAAP (up 13% non-GAAP)
Diluted earnings per share was $2.22 and increased 9% GAAP (up 14% non-GAAP)

“Continued customer commitment to our cloud platform and strong sales execution drove better than expected commercial bookings growth of 28% and Microsoft Cloud revenue of $23.4 billion, up 32% year over year,” said Executive Vice President and Chief Financial Officer of Microsoft Amy Hood.

Business highlights

Consumer growth was expected to be in the high single digits, meaning Microsoft beat expectations with an 11% YoY increase.

Microsoft’s Productivity and Business Processes revenue was $15.8 billion, an increase of 17% year-over-year. That beat industry expectations of $15.75 billion. Here are the company’s business highlights:

Office Commercial products and cloud services revenue increased 12% (up 14% CC) driven by Office 365 Commercial revenue growth of 17% (up 20% CC)
Office Consumer products and cloud services revenue increased 11% (up 12% CC) and Microsoft 365 Consumer subscribers grew to 58.4 million
LinkedIn revenue increased 34% (up 35% CC)
Dynamics products and cloud services revenue increased 22% (up 25% CC) driven by Dynamics 365 revenue growth of 35% (up 38% CC)

Revenue in Intelligent Cloud went up 26% YoY, hitting $19.1 billion in the quarter.

Server products and cloud services revenue increased 29% (up 32% CC) driven by Azure and other cloud services revenue growth of 46% (up 49% CC)

Personal computing revenue was $14.5 billion, marking an increase of 11% compared to the previous year. That also beat expectations, which were $14.27 billion, according to StreetAccount consensus.

Windows OEM revenue increased 11%
Windows Commercial products and cloud services revenue increased 14% (up 19% CC)
Xbox content and services revenue increased 4% (up 6% CC)
Search and news advertising revenue excluding traffic acquisition costs increased 23% (up 25% CC)
Surface revenue increased 13% (up 18% CC)

What’s next

Microsoft CEO Satya Nadella will join other Microsoft higher-ups in an investor call at 2:30 PM Pacific time (5:30 PM Eastern time) today, April 26, 2022. You can watch the webcast through Microsoft’s investor portal.

We’ll update this post following the earnings call.

Microsoft FY22 Q3 earnings: .4 billion revenue exceeds expectations