FY19 Q1 - More Personal Computing Performance- Investor Relations - Microsoft

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Earnings Release FY19 Q1

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More Personal Computing

Revenue increased $1.4 billion or 15%.

• Windows revenue increased $258 million or 6%, driven by growth in Windows Commercial and Windows OEM. Windows Commercial revenue increased 12%, due to an increased volume of multi-year agreements. Windows OEM revenue increased 3%. Windows OEM Pro revenue grew 8%, ahead of the commercial PC market, due to a higher mix of premium licenses. Windows OEM non-Pro revenue declined 5%, below the consumer PC market, due to continued pressure in the entry-level price category.

• Gaming revenue increased $842 million or 44%, driven by Xbox software and services revenue growth of 36%, due to third-party title strength, and Xbox hardware revenue growth of 94%, against a low prior year comparable due to timing of the Xbox One X launch in the second quarter of fiscal year 2018.

• Search advertising revenue increased $149 million or 9%. Search advertising revenue, excluding traffic acquisition costs, increased 17%, driven by growth in Bing, due to higher revenue per search and search volume.

• Surface revenue increased $143 million or 14%.

Operating income increased $578 million or 23%.

• Gross margin increased $547 million or 10%, driven by growth in Windows and Gaming. Gross margin percentage decreased, due to unfavorable sales mix.

• Operating expenses decreased $31 million or 1%.

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

Microsoft Corp (MSFT)

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