Microsoft may be glacial in its selection of CEO — it has been 153 loooong and noisy days since Steve Ballmer said he was stepping down. But he’s certainly going out with a bang, with strong revenue and profit results in the second quarter that bested all Wall Street expectations.
No CEO Yet, but Microsoft Q2 Earnings Bust a Move on Wall Street Expectations
Steve Ballmer is going out with a bang.
For the three months ending Dec. 31, 2013, the software giant said it had revenue of $24.5 billion, with net income of 78 cents per share. Wall Street investors had been expecting it to earn about 69 cents a share on revenue of $23.7 billion. This compares to 62 cents a share in the last quarter on sales of $18.5 billion, and 76 cents a share on revenue of $21.46 billion in the same period a year ago.
In other words, yay. That’s especially true given the worries about declining PC sales, how the move to the cloud would impact Microsoft software sales, especially Office, and a less-than-expected update of its suite of mobile devices, such as Windows Phone and Surface tablets.
The slump in sales of Nokia Lumia devices earlier this week caused particular fretting, given Microsoft’s tight relationship with the smartphone maker.
Because it is Microsoft, its results are complicated, with all kinds of revenue deferred and recognized, but here are some parts to look at:
Microsoft said its devices and consumer revenue grew 13 percent, to $11.91 billion.
While Windows OEM revenue declined three percent, its Pro revenue grew 12 percent, offsetting the “continued softness in the consumer PC market.” (No surprise!)
But Surface revenue, a point of much past pain at the company, doubled from $400 million in the first quarter to $893 million in the second quarter.
And Microsoft said it sold a total of 7.4 million Xbox consoles, pretty much split between new Xbox Ones and Xbox 360s.
Bing search share also rose — about 18 percent — with search advertising revenue up 34 percent.
Microsoft said its enterprise business also did well, up 10 percent to $12.67 billion, with strong revenue growth for SQL Server, System Center, cloud services, Office 365 commercial seats, and Azure customers.
The company’s CFO Amy Hood will star in its call with analysts at 2:30 pm PT today, so perhaps there will be more specifics on sales of Surface tablets and insight into the Nokia situation, and, let’s hope, an update on the CEO search.
This article originally appeared on Recode.net.
