FY18 Q3 - More Personal Computing Performance- Investor Relations - Microsoft

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Earnings Release FY18 Q3

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More Personal Computing

Revenue increased $1.1 billion or 13%.

• Windows revenue increased $359 million or 8%, driven by Windows Commercial and Windows OEM revenue growth. Windows Commercial revenue increased 21%, driven by an increased volume of multi-year agreements and the mix of products that carry higher in-quarter revenue recognition. Windows OEM revenue increased 4%. Windows OEM Pro revenue grew 11%, in line with a strengthening commercial PC market. Windows OEM non-Pro revenue declined 8%, below the consumer PC market, driven by a higher mix of lower priced licenses and continued pressure in the entry-level price category.

• Gaming revenue increased $345 million or 18%, driven by Xbox software and services revenue growth of 24%, mainly from third-party title strength.

• Surface revenue increased $263 million or 32% against a prior year comparable impacted by product end-of-life-cycle dynamics.

• Search advertising revenue increased $185 million or 12%. Search advertising revenue, excluding traffic acquisition costs, increased 16%, driven by growth in Bing, primarily due to higher revenue per search and search volume.

Operating income increased $488 million or 24%, including a favorable foreign currency impact of 4%.

• Gross margin increased $616 million or 13%, driven by growth in Windows and Surface. Gross margin percentage was relatively unchanged. Gross margin included a favorable foreign currency impact of 2%.

• Operating expenses increased $128 million or 5%, driven by investments in Gaming, Search advertising, and AI engineering.

IMPORTANT NOTICE TO USERS (summary only, click here  for full text of notice); All information is unaudited unless otherwise noted or accompanied by an audit opinion and is subject to the more comprehensive information contained in our SEC reports and filings. We do not endorse third-party information. All information speaks as of the last fiscal quarter or year for which we have filed a Form 10-K or 10-Q, or for historical information the date or period expressly indicated in or with such information. We undertake no duty to update the information. Forward-looking statements are subject to risks and uncertainties described in our  Forms 10-Q and 10-K.

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Information contained in these documents is current as of the earnings date, and not restated for new accounting standards

FY18 Earnings Release Schedule

  • Q4-Thursday, July 19

Microsoft Corp (MSFT)

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