Home Cloud Computing Rising cloud revenue helps soften Microsoft’s growth slowdown

Rising cloud revenue helps soften Microsoft’s growth slowdown


Microsoft reported its slowest growth in five years for the first quarter of its fiscal 2023, due largely to a strong US dollar and an ongoing decline in personal computer sales, causing net income to fall by 14% to $17.56 billion from this time last year.

However, the company was still able to post an overall increase in revenue, up 11% to $50.1 billion for the three months that ended September 30, driven by the ongoing strength of its cloud computing services, which exceeded $25 billion in quarterly revenue, up 24%.

As a result of the announcement, Microsoft saw its share price fall by 5.65% in morning trading on the Nasdaq exchange Wednesday.

Speaking to analysts after releasing its financial results, Microsoft CFO Amy Hood said that the company delivered a solid start to its fiscal year, and that the results were “in line with our expectations, even as we saw many of the macro trends from the end of the fourth quarter continued to weaken through Q1,” according to a transcript from Seeking Alpha.

Hood also noted the foreign exchange rates had impacted company results, and that due to the stronger US dollar, conversion from other currencies decreased total company revenue by five percentage points.

Microsoft segment results

Microsoft saw its productivity and business processes segment, which includes Office productivity software, increase by 9% during the quarter to $16.5 billion.

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