Microsoft Corp (MSFT)
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Supplied by Morningstar Inc
2015 Annual Report
Earnings Release FY14 Q1
Revenue impacted by device market trends
Windows OEM revenue
Windows OEM Pro revenue, up 6%; second consecutive quarter of growth
Windows OEM non-Pro revenue, down 22%; several points better than expected
Excluding the impact of China, non-Pro revenue declined 17%
Office Consumer revenue
Revenue declined although attach increased in the quarter
Impact of the shift to Office 365 Home Premium was generally in line with expectations

D&C Licensing revenue decreased $335 million or 7%, due mainly to lower revenue from licenses of Windows OEM and Consumer Office, offset in part by increased Windows Phone revenue. Windows OEM revenue declined $237 million or 7%, reflecting a 22% decrease in OEM non-Pro revenue, offset in part by a 6% increase in OEM Pro revenue. Consumer Office revenue declined $217 million or 23%. These decreases resulted primarily from the impact on revenue of a decline in consumer demand. In the case of Consumer Office, the decline was also influenced by the transition of customers to O365 Home Premium, offset by increased levels of Office attached to devices shipped. Windows Phone revenue increased $102 million, including an increase in patent licensing revenue.

D&C Licensing gross margin decreased $178 million or 4%, due to decreased revenue, offset in part by a $157 million or 27% decrease in cost of revenue. D&C Licensing cost of revenue decreased, due mainly to lower traffic acquisition costs.

Download Segment Information:Excel (27KB)
Devices and Consumer Licensing
RESULTS (in millions, except percentages)
Q114 Q113 Change
Revenue $ 4,343 $ 4,678 (7)%
Gross Margin $ 3,925 $ 4,103 (4)%
FY14 Earnings Release Schedule
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