Microsoft Corporation (NASDAQ: MSFT) stock fell over 3.2% on 28th April, 2021 (as of 10:58:43 UTC-4 · USD; Source: Google finance) after the company posted lower than expected results for the third quarter of FY 21.
The company has reported net income of $15.46 billion for the third quarter of FY 21 compared to $10.75 billion, in last year’s third quarter. The revenue in Productivity and Business Processes increased 15% (up 12% in constant currency) to $13.6 billion. Office Commercial products and cloud services revenue grew 14% (up 10% in constant currency) driven by Office 365 Commercial revenue growth of 22% (up 19% in constant currency). Office Consumer products and cloud services revenue grew 5% (up 2% in constant currency) and Microsoft 365 Consumer subscribers rose to 50.2 million. LinkedIn revenue rose by 25% (up 23% in constant currency). Dynamics products and cloud services revenue grew 26% (up 22% in constant currency) driven by Dynamics 365 revenue growth of 45% (up 40% in constant currency). The revenue in Intelligent Cloud was $15.1 billion and increased 23% (up 20% in constant currency). Server products and cloud services revenue grew 26% (up 23% in constant currency) driven by Azure revenue growth of 50%.
Moreover, the revenue in More Personal Computing rose 19% to $13.0 billion. Windows OEM revenue grew 10%. Windows Commercial products and cloud services revenue rose 10% (up 7% in constant currency) and Xbox content and services revenue grew 34% (up 32% in constant currency). Search advertising revenue excluding traffic acquisition costs rose 17% (up 14% in constant currency) and Surface revenue grew 12% (up 7% in constant currency) in the third quarter.
MSFT in the third quarter of FY 21 has reported the adjusted earnings per share of $1.95, beating the analysts’ estimates for the adjusted earnings per share of $1.78, according to figures compiled by Thomson Reuters. The company had reported the adjusted revenue growth of 19.1 percent to $41.71 billion in the third quarter of FY 21.
Additionally, the company has returned $10 billion to shareholders in the form of share repurchases and dividends in the third quarter of fiscal year 2021, which represents an increase of 1% compared to the third quarter of fiscal year 2020.
Microsoft expects Intelligent Cloud revenue to rise to between $16.2 billion and $16.45 billion in Q4 FY 2021. Microsoft expects More Personal Computing revenue to rise to between $13.6 billion and $14.0 billion in Q4 FY 2021.