-
Revenue: $69.6 billion, up 12% year-over-year.
-
Gross Margin: Increased 13% and 12% in constant currency.
-
Operating Income: Increased 17% and 16% in constant currency.
-
Earnings Per Share (EPS): $3.23, an increase of 10%.
-
Microsoft Cloud Revenue: $40.9 billion, grew 21% year-over-year.
-
AI Business Annual Revenue Run Rate: Surpassed $13 billion, up 175% year-over-year.
-
Commercial Bookings: Increased 67% and 75% in constant currency.
-
Commercial Remaining Performance Obligation: $298 billion, up 34% and 36% in constant currency.
-
Free Cash Flow: $6.5 billion, down 29% year-over-year.
-
LinkedIn Revenue: Increased 9% year-over-year.
-
Dynamics 365 Revenue: Increased 19% and 18% in constant currency.
-
Azure and Other Cloud Services Revenue: Grew 31%, with AI services growing 157% year-over-year.
-
Gaming Revenue: Decreased 7% and 8% in constant currency.
-
Cash Flow from Operations: $22.3 billion, up 18% year-over-year.
-
Return to Shareholders: $9.7 billion through dividends and share repurchases.
Release Date: January 29, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
-
Microsoft Cloud revenue surpassed $40 billion for the first time, growing 21% year-over-year.
-
AI business annual revenue run rate exceeded $13 billion, marking a 175% increase year-over-year.
-
Strong commercial bookings growth of 67% and 75% in constant currency, driven by Azure commitments from OpenAI.
-
Microsoft 365 Copilot saw significant adoption, with customers expanding their seats by more than 10x over the past 18 months.
-
LinkedIn Premium surpassed $2 billion in annual revenue, with subscriber growth increasing nearly 50% over the past two years.
-
Azure non-AI services growth was slightly lower than expected due to go-to-market execution challenges.
-
On-premises server business revenue decreased 3%, slightly below expectations.
-
Enterprise and partner services revenue decreased 1%, below expectations.
-
Gaming revenue decreased 7% and 8% in constant currency, with hardware declines offsetting content and services growth.
-
Free cash flow was down 29% year-over-year, reflecting higher capital expenditures.
Q: Can you explain the execution issues with Azure and the outlook for the rest of the year? A: Amy Hood, CFO, explained that the issues were primarily in the non-AI Azure component, particularly with scale motions involving indirect sales methods. Adjustments are being made to balance AI and non-AI workloads. Despite these challenges, AI results exceeded expectations, and confidence remains in AI growth, with capacity constraints expected to ease by year-end.
