Microsoft posted the third quarter of its 2021 financial results today, reporting revenue of $41.7 billion and a net income of $15.5 billion. Revenue is up 19 percent, and net income has increased by 44 percent. Once again, Microsoft has seen strong growth for Surface, Xbox, and cloud-related services.
“Over a year into the pandemic, digital adoption curves aren’t slowing down. They’re accelerating, and it’s just the beginning,” said Microsoft’s CEO Satya Nadella in the Q3 press release. “We are building the cloud for the next decade, expanding our addressable market and innovating across every layer of the tech stack to help our customers be resilient and transform.”
As usual, Microsoft earnings are broken up into three groups: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. Those accounted for $13.6 billion, $15.1 billion, and $13 billion in revenue, respectively, for year-over-year growth of 15%, 23%, and 19%.
Starting with Productivity and Business Processes, that included a 14% increase in revenue from Office Commercial products and cloud services. Breaking that down, Office 365 Commercial revenue is up 22%, while products declined 25%. On the consumer end, Office products and cloud services revenue increased by 5% and Microsoft 365 Consumer subscribers are now at 50.2 million.
LinkedIn revenue continues to grow, as it’s up 25%, and Microsoft says that sessions are up 29%. Dynamics products and services are up 26%, once again driven by cloud offerings with Dynamics 365 revenue up 45%.
And then there’s the Intelligent Cloud bucket, which is now Microsoft’s biggest business. Inside of that bucket is server products and cloud services, which is up 26%, driven by Azure revenue, which is up an impressive 50% . Server products are up 3%.
Finally, we have the More Personal Computing category, which is up 19% as a whole. Windows OEM revenue is up 10% thanks to the work from home demand. That’s particularly impressive since last year, it was touting strong results thanks to the Windows 7 end of life. Windows OEM Pro revenue still declined 2%, but non-Pro grew by 44%.
While hardware and Windows are Microsoft’s main consumer-facing businesses, cloud services are huge on the commercial side. Office commercial and cloud services revenue has grown 14 percent this quarter, along with Office 365 commercial growth of 22 percent.
Even Office consumer offerings are doing well for Microsoft. Office consumer products and cloud services revenue grew 5 percent this quarter, thanks to Microsoft 365 Consumer subscription revenue and a big 27 percent jump in subscribers to 50.2 million.
As the reports show, the pandemic has only accelerated growth for Microsoft in a great many areas.
