Microsoft just released its earnings report for the last quarter, and the major takeaway is that Windows Phone sales were beyond bleak, while Surface revenue performed pretty decently. It also beat analysts' expectations.
For its 2016 fiscal year second-quarter, the Redmond-based company made $6.3 billion in net income on $25.7 billion in revenue. Microsoft's adjusted revenue fell from the $26.14 billion it recorded for the year-ago quarter. Meanwhile, Wall Street analysts had expected Microsoft to report $25.26 billion in revenue for its fiscal second quarter, according to Thomson Reuters. But enough about that; let's talk sales numbers...
Microsoft's Windows Phone revenue tanked 49 per cent year over year, despite the recent launch of the Lumia 950 and 950 X. It only sold 4.5 million Lumia phones during the 90-day period, compared to 10.5 million for the same time last year. That's a whopping 57 per cent dip. Keep in mind Apple just revealed that it sold 74.7 million iPhones during the last 90 days of 2015.
Surface revenue is up year-over-year by 29 per cent to $1.35 billion however, and Microsoft said that's due to the Surface Book and Surface Pro 4. The declining PC market still affected the company, even though Windows 10 released last summer, as Windows OEM Pro revenue fell 6 per cent.
Other interesting numbers from the earnings report include 48 million Xbox Live monthly active users (30 percent yoy growth) 20.6 million Office 365 consumer subscribers (resulting in a 70 per cent Office 365 revenue growth), and 200 million monthly active Windows 10 devices.
Although Microsoft said Xbox hardware revenue fell because of lower volumes of Xbox 360 sales, it wouldn't get specific about the number of next-generation consoles it sold during the recent quarter. Neverthless, Microsoft shared jumped more than 8 per cent in after-hours trading.
Microsoft plans to hold an earnings call at 5:30PM EST.