Microsoft announces Q3 2016 earnings: Surface grows, Phone continues to disappoint

Microsoft today announced its earnings for Q3 2016 (Fiscal Year). The company announced a revenue of $20.5 billion GAAP, and $22.1 billion non-GAAP, and a net income of $3.8 billion GAAP, and $5.0 billion non-GAAP. Here’s a rundown of everything from the company’s earnings report:

• Revenue was $20.5 billion GAAP, and $22.1 billion non-GAAP
• Operating income was $5.3 billion GAAP, and $6.8 billion non-GAAP
• Net income was $3.8 billion GAAP, and $5.0 billion non-GAAP
• Earnings per share was $0.47 GAAP, and $0.62 non-GAAP

In a press release, the company stated:

Revenue in Productivity and Business Processes grew 1% (up 6% in constant currency) to $6.5 billion, with the following business highlights:

• Office commercial products and cloud services revenue grew 7% in constant currency driven by Office 365 revenue growth of 63% in constant currency
• Office consumer products and cloud services revenue grew 6% in constant currency with Office 365 consumer subscribers increasing to 22.2 million
• Dynamics products and cloud services revenue grew 9% in constant currency with Dynamics CRM Online seat adds more than doubling year-over-year

Revenue in Intelligent Cloud grew 3% (up 8% in constant currency) to $6.1 billion, with the following business highlights:

• Server products and cloud services revenue increased 5% in constant currency driven by double-digit annuity revenue growth
• Azure revenue grew 120% in constant currency with usage of Azure compute and Azure SQL database more than doubling year-over-year
• Enterprise Mobility customers more than doubled year-over-year to over 27,000, and the installed base grew nearly 4x year-over-year

Revenue in More Personal Computing grew 1% (up 3% in constant currency) to $9.5 billion, with the following business highlights:

• Windows OEM revenue declined 2% in constant currency, outperforming the PC market, driven by higher consumer premium device mix
• Surface revenue increased 61% in constant currency driven by Surface Pro 4 and Surface Book
• Phone revenue declined 46% in constant currency
• Xbox Live monthly active users grew 26% year-over-year to 46 million
• Search advertising revenue excluding traffic acquisition costs grew 18% in constant currency with continued benefit from Windows 10 usage

You can find the full earnings report here.