FY19 Q3 - More Personal Computing Performance- Investor Relations - Microsoft
Browse Prior Earnings Releases:
Earnings Release FY19 Q3
More Personal Computing
Revenue increased $763 million or 8%.
• Windows revenue increased $332 million or 7%, driven by growth in Windows OEM and Windows Commercial, offset in part by a decrease in patent licensing. Windows OEM revenue increased 9%. Windows OEM Pro revenue increased 15%, driven by improved chip supply that met both unfulfilled second quarter and better than expected third quarter commercial PC demand. Windows OEM non-Pro revenue declined 1%, ahead of the consumer PC market, driven by improved chip supply for premium devices that met both unfulfilled second quarter and third quarter demand. Windows Commercial revenue increased 18%, driven by an increased mix of multi-year agreements that carry higher in-quarter revenue recognition.
• Surface revenue increased $235 million or 21%, with strong growth across commercial and consumer.
• Search advertising revenue increased $127 million or 7%. Search advertising revenue, excluding traffic acquisition costs, increased 12%, driven by growth in Bing, due to higher revenue per search.
• Gaming revenue increased $112 million or 5%, driven by Xbox software and services growth of 12%, primarily due to third-party title strength and subscriptions growth, offset in part by a decline in Xbox hardware of 33% primarily due to a decrease in volume of consoles sold.
Operating income increased $631 million or 25%, including an unfavorable foreign currency impact of 3%.
• Gross margin increased $673 million or 13%, driven by growth in Windows, Gaming, and Search. Gross margin percentage increased, due to a sales mix shift to higher gross margin businesses in Gaming and Windows. Gross margin included an unfavorable foreign currency impact of 2%.
• Operating expenses increased $42 million or 1%, driven by an increase in Surface advertising.
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Information contained in these documents is current as of the earnings date, and not restated for new accounting standards