Browse Prior Earnings Releases:
Earnings Release FY21 Q2
Performance
Revenue increased $6.2 billion or 17%, driven by growth across each of our segments. Intelligent Cloud revenue increased, driven by server products and cloud services. More Personal Computing revenue increased, driven by Gaming. Productivity and Business Processes revenue increased, driven by Office Commercial and LinkedIn.
Cost of revenue increased $1.8 billion or 15%, driven by growth in Gaming and commercial cloud, offset in part by a reduction in depreciation expense due to the change in estimated useful lives of our server and network equipment.
Gross margin increased $4.3 billion or 18%, driven by growth across each of our segments and the change in estimated useful lives of our server and network equipment. Gross margin percentage increased slightly, driven by the change in estimated useful lives of our server and network equipment. Commercial cloud gross margin percentage increased 4 points to 71%, driven by the change in estimated useful lives of our server and network equipment. Excluding this impact, commercial cloud gross margin percentage was relatively unchanged, driven by gross margin percentage improvement in Azure, offset in part by sales mix shift to Azure.
Key changes in operating expenses were:
• Research and development expenses increased $296 million or 6%, driven by investments in cloud engineering.
• Sales and marketing expenses were relatively unchanged, driven by investments in commercial sales, offset in part by reductions in advertising.
• General and administrative expenses increased $18 million or 2%.
Operating income increased $4.0 billion or 29%, driven by growth across each of our segments and the change in estimated useful lives of our server and network equipment.
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Information contained in these documents is current as of the earnings date, and not restated for new accounting standards