Despite fears that Microsoft’s shifting focus towards cloud services would make a dent in its revenues, this and the acquisition of Nokia, have played a big part in ensuring a rise in the company’s earnings for the fiscal first quarter. Microsoft has revealed its gross margin, operating income and diluted earnings per share for the quarter ending September 30, 2014, as $14.93 billion, $5.84 billion and $0.54, correspondingly. It has also reported a revenue of $23.20 billion for the aforesaid quarter.
Microsoft is very serious about squeezing its cloud services into every available market space. On his recent visit to India, CEO Satya Nadella, expressed interest in investing in this sector here since adoption of public and hybrid cloud services is still at its early stages. The company claimed that earnings from providing such services in India has increased by over 100 percent in the past year.
On a global scale, Microsoft’s commercial cloud revenue enjoyed a 128 percent increase due to Office 365, Azure and Dynamics CRM. The tech giant managed to produce such impressive results (contradicting gloomy predictions from industry watchers) in spite of spending $1.14 billion in integration and restructuring expenses, an amount which made a $0.11 per share negative impact.
The expenses are related to the restructuring plan unveiled in July 2014 as well as the ensuing integration of Nokia’s devices and services business unit. Revenue from phone hardware crossed $2.6 billion, shipments of Xbox consoles grew by 102 percent and the market reaction to the Surface Pro 3 tablet helped increase earnings for the tablet series to $908 million.
Microsoft has been gravitating towards hardware, cloud and other related products ever since 2013 which also saw the company acquire Nokia. When ex-CEO Steve Ballmer announced his retirement last year, he spoke about the brand planning to move away from software in order to survive.