FY17 Q3 - Intelligent Cloud Performance - Investor Relations - Microsoft

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Earnings Release FY17 Q3

NarrativePower BI

Intelligent Cloud

Revenue increased $667 million or 11%, primarily due to higher revenue from server products and cloud services.

• Server products and cloud services revenue grew $680 million or 15%, driven by Azure revenue growth of 93% and server products licensed on-premises revenue growth of 6%.

• Enterprise Services revenue decreased slightly, driven by a decline in revenue from custom support agreements, offset in part by higher revenue from Premier Support Services and Microsoft Consulting Services.

Operating income increased slightly, primarily due to higher gross margin, offset by higher operating expenses. Operating income included an unfavorable foreign currency impact of 3%.

• Gross margin increased $246 million or 6%, driven by higher revenue, offset in part by higher cost of revenue. Cost of revenue increased $421 million or 25%, driven by investments to increase capacity and meet demand for the capabilities of our cloud offerings.

• Operating expenses increased $241 million or 11%, driven by investments in sales capacity, cloud engineering, and developer engagement. Sales and marketing expenses increased $139 million or 13% and research and development expenses increased $98 million or 12%.

IMPORTANT NOTICE TO USERS (summary only, click here  for full text of notice); All information is unaudited unless otherwise noted or accompanied by an audit opinion and is subject to the more comprehensive information contained in our SEC reports and filings. We do not endorse third-party information. All information speaks as of the last fiscal quarter or year for which we have filed a Form 10-K or 10-Q, or for historical information the date or period expressly indicated in or with such information. We undertake no duty to update the information. Forward-looking statements are subject to risks and uncertainties described in our  Forms 10-Q and 10-K.

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Information contained in these documents is current as of the earnings date, and not restated for new accounting standards

FY17 Earnings Release Schedule

  • Q4-Thursday, July 20

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