BENGALURU, India (Reuters) – Microsoft beat Wall Street’s expectations for quarterly revenue, according to data released on Tuesday, as demand for cloud computing-based services increased.
Microsoft said revenue for the “intelligent cloud” segment grew 31 percent to $17 billion. Analysts had expected a value of $16.58 billion, according to data from Refinitiv.
Revenue growth for the company’s core cloud computing business, Azure, came in at 48%, beating analyst estimates of 47%, according to data from Visible Alpha.
Azure’s growth rate is the best direct measure of competition from rivals such as Amazon.com’s AWS and Alphabet’s Google Cloud, because Microsoft doesn’t break out the cloud computing unit’s revenue.
“We started the fiscal year strong, with our Microsoft Cloud reporting $20.7 billion in revenue for the quarter, a 36 percent year-over-year increase,” said Amy Hood, Microsoft’s executive vice president and chief financial officer.
Overall, revenue rose to $45.32 billion in the first fiscal quarter ended September 30, up from $37.15 billion a year ago, nearly beating expectations of $43.97 billion.
Net income rose to $20.51 billion, or $2.71 per share, from $13.89 billion, or $1.82 per share, a year ago. The company said its results included a net income tax benefit of $3.3 billion.
(Reporting by Subrata Patnaik)