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(Pocket-lint) - Microsoft has post its third-quarter fiscal results for 2016, and one thing is clear: its phone business isn't doing so hot.

The company made $3.8 billion in net income on $20.5 billion in revenue, both of which are down year-over year. Speaking of things going down, Microsoft only sold 2.3 million Lumia devices in the period that ended on 30 March. That's a whopping 73 per cent drop from 8.6 million in the same period last year. For comparison, Apple sold 13 million iPhone 6Ss its opening weekend.

Microsoft's mobile revenue therefore fell by as much as 46 per cent Still, the company saw growth from Surfaces. The segment grew by $1.1 billion during the quarter, up 61 per cent year-over-year. Microsoft attributed this growth to Surface Pro 4 and Surface Book sales, but of course it neglected to provide firm numbers for how many tablets and computers it sold in the last three months.

Windows OEM revenue dropped 2 per cent, outperforming the remainder of the PC market. Microsoft said it was able to outperform the PC market because of a "higher consumer premium device mix". It also saw some growth in the cloud department. Office commercial and cloud services like Office 365 spiked 7 per cent this quarter, while consumer versions of Office went up 6 per cent.

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Microsoft now has 22.2 million Office 365 consumer subscriptions. As for server products and cloud services, Microsoft said revenue increased 5 per cent. Azure revenue increased by 120 per cent.

Writing by Elyse Betters. Originally published on 21 April 2016.