Sunday, December 5, 2021

Microsoft’s profit grows 48% to $ 20.5 billion

Microsoft unveiled its most profitable quarter. Again.

The company said Tuesday that revenue for the three months ended September was $ 45.3 billion, up 22% from a year earlier. Profits rose 48% to $ 20.5 billion.

The results exceeded analysts’ optimistic expectations and the stock rose slightly after the close of trading.

The profit was driven by success in Microsoft’s cloud computing business, which includes subscriptions to Office 365 and Azure. Sales of these products to commercial customers grew 36% quarter-on-quarter to $ 20.7 billion. Analysts say customers are entering into longer and longer contracts, resulting in sales of Azure increasing 50% over the same period last year. The Redmond-based company said demand was broad across industries and geographic regions.

Microsoft CEO Satya Nadella said in a statement that increased use of technology could be “a deflationary force in an inflationary economy,” arguing that digital tools can improve productivity and affordability.

This technology adoption has been fueled by the pandemic. “COVID has demonstrated how well the cloud works,” said Brad Rebak, an analyst at investment bank Stifel. Many organizations and large companies had long-term plans to move to the cloud, but “COVID forced them to move faster so that some things move faster. The success they have achieved has encouraged cloud leaders to become more aggressive, ”he said.

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And thanks to strong hiring demand, LinkedIn’s revenue grew 42%. The company said this summer that it had more than $ 10 billion in annual sales for the professional social networking site.

Microsoft has indeed felt some effect of the global supply chain clogging, especially from the shortage of some computer chips. The company said sales of its Windows operating system would have been higher were it not for a shortage of new computers, although it still exceeded the company’s expectations with 10% growth.

But any spikes were more than offset by the strength of the company’s core corporate business.

Profits were boosted by a $ 3.3 billion one-time tax savings associated with transfers of intellectual property from Puerto Rico following the closure of operations there. Even without that win, the company surpassed the record profit it earned just three months ago.

Microsoft Philanthropies funds some of the Seattle Times journalism projects.

Nation World News Deskhttps://nationworldnews.com
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