Microsoft says COVID-19 had 'minimal' impact on its business

Microsoft weathers the coronavirus storm, posting earnings boost from its cloud business

Microsoft posts $35B in revenue, up 15%, sees ‘minimal net impact’ from COVID-19 in quarter

Microsoft's earnings for its third fiscal quarter have surpassed analysts' estimates, but the company itself is lowering its expectations as the ramifications of Covid-19 become clearer.

If Microsoft Teams is now included for free with various Microsoft 365 business plans, the app will also soon allow users to add their personal Microsoft account to chat and collaborate with friends and family.

Microsoft's revenue from January to March saw a 15% rise from a year ago, at $35.02 billion.

A big boost came from Microsoft's Azure cloud business, which the Redmond, Wash., company said propelled sales up 59% in the quarter.

Commercial cloud was the big victor again, but Xbox has also enjoyed substantial growth.

"Ultimately, Microsoft is not immune from what is going on broadly in the world in terms of GDP growth", Nadella said on a conference call with investors.

The company on Wednesday reported fiscal third-quarter profit of $10.75 billion, up 22% from the same period past year.

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Michael's ability run its applications like Teams, Office 365 and Dynamics 365 on its own infrastructure also gives the company an edge over rivals, Elman said. After announcing 44 million daily active users for Teams in March, the team collaboration app added more than 30 million users in a month to reach more than 75 million daily active users. Nadella pointed to 258 million paid seats.

Microsoft sales were helped by demand for cloud services.

Revenue in Business processes and productivity reached United States dollars 11.7 Billion, a 15% increase.

Microsoft's business social-media network LinkedIn also felt the effect from the spending slowdown toward the end of the quarter with reduced advertising spending, the company said, though revenue over the full quarter rose 21% from a year earlier.

More Personal Computing, which include Windows, was up 35% with $11 billion revenue.

Microsoft's Surface gadgets recorded a flat Q3, which is probably good news following the drop in global PC shipment due to the pandemic. The company says demand was strong, but Chinese supply contstraints in the COVID-19 lockdown limited growth to 1%. "Significant improvement in Azure gross margin percentage, including some benefit from short-term utilization gains as we worked through COVID-19 related supply chain constraints, more than offset sales mix shift to Azure", she said. So-much-so, Microsoft broke a recent tradition of not offering a detailed breakdown of the division to discuss its success last quarter. Xbox Game Pass has more than 10 million subscribers, while Project xCloud has hundreds of thousands of active users. It would seem a majority of those new users joined in the last 2 months.

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