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EX-99.1

Exhibit 99.1

Microsoft Cloud Strength Highlights Third Quarter Results

Commercial cloud annualized revenue run rate exceeds $15.2 billion

REDMOND, Wash. — April 27, 2017 — Microsoft Corp. today announced the following results for the quarter ended March 31, 2017:

 

  •   Revenue was $22.1 billion GAAP, and $23.6 billion non-GAAP
  •   Operating income was $5.6 billion GAAP, and $7.1 billion non-GAAP
  •   Net income was $4.8 billion GAAP, and $5.7 billion non-GAAP
  •   Diluted earnings per share was $0.61 GAAP, and $0.73 non-GAAP

“Our results this quarter reflect the trust customers are placing in the Microsoft Cloud,” said Satya Nadella, chief executive officer at Microsoft. “From large multi-nationals to small and medium businesses to non-profits all over the world, organizations are using Microsoft’s cloud platforms to power their digital transformation.”

The following table reconciles our financial results reported in accordance with generally accepted accounting principles (“GAAP”) to non-GAAP financial results. Microsoft has provided this non-GAAP financial information to aid investors in better understanding the company’s performance. Additional information regarding our non-GAAP definition is provided below. All growth comparisons relate to the corresponding period in the last fiscal year.

 

     

Three Months Ended March 31,

 

 

   ($ in millions, except per share amounts)

 

  

  Revenue  

 

    

Operating

    Income    

 

    

Net

  Income  

 

    

Diluted

Earnings

  per Share  

 

 

 

  2016 As Reported (GAAP)

 

    

 

$20,531

 

 

 

    

 

$5,283

 

 

 

    

 

$3,756

 

 

 

    

 

$0.47

 

 

 

 

    Net Impact from Windows 10 Revenue Deferrals

 

    

 

1,625

 

 

 

    

 

1,625

 

 

 

    

 

1,282

 

 

 

    

 

0.16

 

 

 

 

  2016 As Adjusted (non-GAAP)

 

    

 

$22,156

 

 

 

    

 

$6,908

 

 

 

    

 

$5,038

 

 

 

    

 

$0.63

 

 

 

 

  2017 As Reported (GAAP)

 

    

 

$22,090

 

 

 

    

 

$5,594

 

 

 

    

 

$4,801

 

 

 

    

 

$0.61

 

 

 

 

    Net Impact from Windows 10 Revenue Deferrals

 

    

 

1,467

 

 

 

    

 

1,467

 

 

 

    

 

914

 

 

 

    

 

0.12

 

 

 

 

  2017 As Adjusted (non-GAAP)

 

    

 

$23,557

 

 

 

    

 

$7,061

 

 

 

    

 

$5,715

 

 

 

    

 

$0.73

 

 

 

 

  Percentage Change Y/Y (GAAP)

 

    

 

8%

 

 

 

    

 

6%

 

 

 

    

 

28%

 

 

 

    

 

30%

 

 

 

 

  Percentage Change Y/Y (non-GAAP)

 

    

 

6%

 

 

 

    

 

2%

 

 

 

    

 

13%

 

 

 

    

 

16%

 

 

 

 

  Percentage Change Y/Y (non-GAAP) Constant Currency

 

    

 

7%

 

 

 

    

 

5%

 

 

 

    

 

16%

 

 

 

    

 

19%

 

 

 

Microsoft returned $4.6 billion to shareholders in the form of share repurchases and dividends in the third quarter of fiscal year 2017.

“Strong execution and demand for our cloud-based services drove our commercial cloud annualized revenue run rate to more than $15.2 billion,” said Amy Hood, executive vice president and chief financial officer at Microsoft.

Revenue in Productivity and Business Processes was $8.0 billion and increased 22% (up 23% in constant currency), with the following business highlights:

 

  •   Office commercial products and cloud services revenue increased 7% (up 8% in constant currency) driven by Office 365 commercial revenue growth of 45% (up 45% in constant currency)
  •   Office consumer products and cloud services revenue increased 15% (up 14% in constant currency) and Office 365 consumer subscribers increased to 26.2 million


  •   Dynamics products and cloud services revenue increased 10% (up 11% in constant currency) driven by Dynamics 365 revenue growth of 81% (up 82% in constant currency)
  •   LinkedIn contributed revenue of $975 million

Revenue in Intelligent Cloud was $6.8 billion and increased 11% (up 12% in constant currency), with the following business highlights:

 

  •   Server products and cloud services revenue increased 15% (up 16% in constant currency) driven by Azure revenue growth of 93% (up 94% in constant currency)
  •   Enterprise Services revenue decreased 1% (unchanged in constant currency) with declines in custom support agreements offset by growth in Premier Support Services and consulting

Revenue in More Personal Computing was $8.8 billion and decreased 7% (down 7% in constant currency) driven primarily by lower phone revenue, with the following business highlights:

 

  •   Windows OEM revenue increased 5% (up 5% in constant currency)
  •   Windows commercial products and cloud services revenue increased 6% (up 6% in constant currency)
  •   Surface revenue decreased 26% (down 25% in constant currency)
  •   Search advertising revenue excluding traffic acquisition costs increased 8% (up 9% in constant currency)
  •   Gaming revenue increased 4% (up 6% in constant currency)

Business Outlook

Microsoft will provide forward-looking guidance in connection with this quarterly earnings announcement on its earnings conference call and webcast.

Webcast Details

Satya Nadella, chief executive officer, Amy Hood, executive vice president and chief financial officer, Frank Brod, chief accounting officer, John Seethoff, deputy general counsel and corporate secretary, and Chris Suh, general manager of Investor Relations, will host a conference call and webcast at 2:30 p.m. Pacific time (5:30 p.m. Eastern time) today to discuss details of the company’s performance for the quarter and certain forward-looking information. The session may be accessed at http://www.microsoft.com/en-us/investor. The webcast will be available for replay through the close of business on April 27, 2018.

“As Adjusted” Financial Results and non-GAAP Measures

During the third quarter of fiscal years 2017 and 2016, GAAP revenue, operating income, net income, and diluted earnings per share include the net impact from Windows 10 revenue deferrals. This item is defined below. In addition to these financial results reported in accordance with GAAP, Microsoft has provided certain non-GAAP financial information to aid investors in better understanding the company’s performance. Presenting these non-GAAP measures gives additional insight into operational performance and helps clarify trends affecting the company’s business. For comparability of reporting, management considers this information in conjunction with GAAP amounts in evaluating business performance.

Net Impact from Windows 10 Revenue Deferrals. With respect to our non-GAAP measures related to Windows 10 revenue, we believe these measures bridge investor information and minimize potential confusion during the brief period between the time Windows 10 revenue recognition moved from upfront to ratable, and the adoption of the new revenue standard, when Windows 10 will again be recognized predominantly upfront. The net change in Windows 10 revenue from period to period is indicative of the net change in revenue we expect from adoption of the new revenue standard.


Non-GAAP Definitions

Net Impact from Windows 10 Revenue Deferrals. Microsoft recorded net revenue deferrals of $1.5 billion during the third quarter of fiscal year 2017 and net revenue deferrals of $1.6 billion during the third quarter of fiscal year 2016, related to Windows 10.

With the launch of Windows 10 in July 2015, Windows 10 customers receive future versions and updates at no additional charge. Under current revenue recognition accounting guidance, when standalone software is sold with future upgrade rights, revenue must be deferred over the life of the computing device on which it is installed. This is different from prior versions of Windows, which were sold without upgrade rights, where all revenue from original equipment manufacturer (“OEM”) customers was recognized at the time of billing, i.e., upfront.

When Microsoft adopts the new revenue standard, predominantly all Windows OEM revenue will be recognized at the time of billing, which is similar to the revenue recognition for prior versions of Windows. Additional information regarding the new revenue standard is provided in the “Recent Accounting Guidance Not Yet Adopted” section of Microsoft’s Form 10-Q for the quarter ended March 31, 2017 (Notes to Financial Statements). Microsoft reflects the recognition of Windows 10 revenue at the time of billing in “As Adjusted (non-GAAP)” revenue to provide comparability during the short period where Windows 10 will be recognized over the estimated life of a device, i.e., ratably, rather than at the time of billing.

Constant Currency

Microsoft presents constant currency information to provide a non-GAAP framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period non-GAAP results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the comparative period rather than the actual exchange rates in effect during the respective periods. The non-GAAP financial measures presented below should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP. All growth comparisons relate to the corresponding period in the last fiscal year.


Financial Performance Constant Currency Reconciliation

 

     

Three Months Ended March 31,

 

 

   ($ in millions, except per share amounts)

 

  

  Revenue  

 

    

  Operating  

  Income  

 

    

  Net  

  Income  

 

    

  Diluted  

  Earnings  

  per Share  

 

 

 

  2016 As Reported (GAAP)

 

    

 

$20,531

 

 

 

    

 

$5,283

 

 

 

    

 

$3,756

 

 

 

    

 

$0.47

 

 

 

 

  2016 As Adjusted (non-GAAP)

 

    

 

$22,156

 

 

 

    

 

$6,908

 

 

 

    

 

$5,038

 

 

 

    

 

$0.63

 

 

 

 

  2017 As Reported (GAAP)

 

    

 

$22,090

 

 

 

    

 

$5,594

 

 

 

    

 

$4,801

 

 

 

    

 

$0.61

 

 

 

 

  2017 As Adjusted (non-GAAP)

 

    

 

$23,557

 

 

 

    

 

$7,061

 

 

 

    

 

$5,715

 

 

 

    

 

$0.73

 

 

 

 

  Percentage Change Y/Y (GAAP)

 

    

 

8%

 

 

 

    

 

6%

 

 

 

    

 

28%

 

 

 

    

 

30%

 

 

 

 

  Percentage Change Y/Y (non-GAAP)

 

    

 

6%

 

 

 

    

 

2%

 

 

 

    

 

13%

 

 

 

    

 

16%

 

 

 

 

  Constant Currency Impact

 

    

 

$(222)

 

 

 

    

 

$(181)

 

 

 

    

 

$(153)

 

 

 

    

 

$(0.02)

 

 

 

 

  Percentage Change Y/Y (non-GAAP) Constant Currency

 

    

 

7%

 

 

 

    

 

5%

 

 

 

    

 

16%

 

 

 

    

 

19%

 

 

 

Segment Revenue Constant Currency Reconciliation

 

     

Three Months Ended March 31,

 

 

   ($ in millions)

 

  

Productivity and

Business Processes

 

    

Intelligent Cloud

 

    

More Personal

      Computing      

 

 

 

  2016 As Reported (GAAP)

 

  

 

 

 

 

$6,521

 

 

 

 

  

 

 

 

 

$6,096

 

 

 

 

  

 

 

 

 

$9,539

 

 

 

 

 

  2017 As Reported (GAAP)

 

  

 

 

 

 

$7,958

 

 

 

 

  

 

 

 

 

$6,763

 

 

 

 

  

 

 

 

 

$8,836

 

 

 

 

 

  Percentage Change Y/Y (GAAP)

 

  

 

 

 

 

22%

 

 

 

 

  

 

 

 

 

11%

 

 

 

 

  

 

 

 

 

(7)%

 

 

 

 

 

  Constant Currency Impact

 

  

 

 

 

 

$(82)

 

 

 

 

  

 

 

 

 

$(74)

 

 

 

 

    

 

 

$(67)

 

 

 

 

 

 

  Percentage Change Y/Y (non-GAAP) Constant Currency

 

  

 

 

 

 

23%

 

 

 

 

  

 

 

 

 

12%

 

 

 

 

  

 

 

 

 

(7)%

 

 

 

 

Selected Product and Service Revenue Constant Currency Reconciliation

 

     

Three Months Ended March 31,

 

 
     

Percentage Change

Y/Y (GAAP)

 

    

Constant Currency

Impact

 

    

Percentage Change

Y/Y (non-GAAP)

Constant Currency

 

 

 

  Office commercial products and cloud services

 

  

 

 

 

 

7%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

8%

 

 

 

 

 

  Office 365 commercial

 

  

 

 

 

 

45%

 

 

 

 

  

 

 

 

 

0%

 

 

 

 

    

 

 

45%

 

 

 

 

 

 

  Office consumer products and cloud services

 

  

 

 

 

 

15%

 

 

 

 

  

 

 

 

 

(1)%

 

 

 

 

    

 

14%

 

 

 

 

  Dynamics products and cloud services

 

  

 

 

 

 

10%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

11%

 

 

 

 

 

  Dynamics 365

 

  

 

 

 

 

81%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

 

82%

 

 

 

 

 

 

 

  Server products and cloud services

 

  

 

 

 

 

15%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

16%

 

 

 

 

 

  Azure

 

  

 

 

 

 

93%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

94%

 

 

 

 

 

  Enterprise Services

 

  

 

 

 

 

(1)%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

0%

 

 

 

 

 

  Windows OEM

 

  

 

 

 

 

5%

 

 

 

 

  

 

 

 

 

0%

 

 

 

 

  

 

 

 

 

5%

 

 

 

 

 

  Windows commercial products and cloud services

 

  

 

 

 

 

6%

 

 

 

 

  

 

 

 

 

0%

 

 

 

 

  

 

 

 

 

6%

 

 

 

 

 

  Surface

 

  

 

 

 

 

(26)%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

(25)%

 

 

 

 

 

  Search advertising excluding traffic acquisition costs

 

  

 

 

 

 

8%

 

 

 

 

  

 

 

 

 

1%

 

 

 

 

  

 

 

 

 

9%

 

 

 

 

 

  Gaming

 

  

 

 

 

 

4%

 

 

 

 

  

 

 

 

 

2%

 

 

 

 

  

 

 

 

 

6%

 

 

 

 


Commercial Cloud Annualized Revenue Run Rate

Commercial cloud annualized revenue run rate is calculated by taking revenue in the final month of the quarter multiplied by twelve for Office 365 commercial, Azure, Dynamics 365, and other cloud properties.

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) is the leading platform and productivity company for the mobile-first, cloud-first world and its mission is to empower every person and every organization on the planet to achieve more.

Forward-Looking Statements

Statements in this release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors such as:

 

  •   intense competition in all of Microsoft’s markets;

 

  •   increasing focus on services presents execution and competitive risks;

 

  •   significant investments in new products and services that may not be profitable;

 

  •   acquisitions, joint ventures, and strategic alliances may have an adverse effect on our business;

 

  •   impairment of goodwill or amortizable intangible assets causing a significant charge to earnings;

 

  •   Microsoft’s continued ability to protect and earn revenues from its intellectual property rights;

 

  •   claims that Microsoft has infringed the intellectual property rights of others;

 

  •   the possibility of unauthorized disclosure of significant portions of Microsoft’s source code;

 

  •   cyber-attacks and security vulnerabilities in Microsoft products and services that could reduce revenue or lead to liability;

 

  •   disclosure of personal data that could cause liability and harm to Microsoft’s reputation;

 

  •   outages, data losses, and disruptions of our online services if we fail to maintain an adequate operations infrastructure;

 

  •   government litigation and regulation that may limit how Microsoft designs and markets its products;

 

  •   potential liability under trade protection and anti-corruption laws resulting from our international operations;

 

  •   laws and regulations relating to the handling of personal data may impede the adoption of our services or result in increased costs, legal claims, or fines against us;

 

  •   Microsoft’s ability to attract and retain talented employees;

 

  •   adverse results in legal disputes;

 

  •   unanticipated tax liabilities;


  •   Microsoft’s hardware and software products may experience quality or supply problems;

 

  •   exposure to increased economic and operational uncertainties from operating a global business, including the effects of foreign currency exchange;

 

  •   catastrophic events or geo-political conditions may disrupt our business; and

 

  •   adverse economic or market conditions may harm our business.

For more information about risks and uncertainties associated with Microsoft’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of Microsoft’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting Microsoft’s Investor Relations department at (800) 285-7772 or at Microsoft’s Investor Relations website at http://www.microsoft.com/en-us/investor.

All information in this release is as of April 27, 2017. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.

For more information, press only:

Rapid Response Team, Waggener Edstrom Worldwide, (503) 443-7070, rrt@waggeneredstrom.com

For more information, financial analysts and investors only:

Chris Suh, general manager, Investor Relations, (425) 706-4400

Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://www.microsoft.com/news. Web links, telephone numbers, and titles were correct at time of publication, but may since have changed. Shareholder and financial information, as well as today’s 2:30 p.m. Pacific time conference call with investors and analysts, is available at http://www.microsoft.com/en-us/investor.


MICROSOFT CORPORATION

INCOME STATEMENTS

(In millions, except per share amounts)(Unaudited)

 

    

Three Months Ended

March 31,

    

Nine Months Ended 

March 31, 

 
         2017           2016           2017           2016   

 

 

 Revenue:

           

 Product

               $13,391                   $14,321                   $43,421                   $47,514   

 Service and other

     8,699         6,210         23,212         17,192   

 

    

 

 

    

 

 

    

 

 

 

 Total revenue

     22,090         20,531         66,633         64,706   

 

    

 

 

    

 

 

    

 

 

 

 Cost of revenue:

           

 Product

     3,075         3,801         12,034         14,104   

 Service and other

     4,985         3,921         13,771         10,697   

 

    

 

 

    

 

 

    

 

 

 

 Total cost of revenue

     8,060         7,722         25,805         24,801   

 

    

 

 

    

 

 

    

 

 

 

 Gross margin

     14,030         12,809         40,828         39,905   

 Research and development

     3,355         2,980         9,523         8,842   

 Sales and marketing

     3,879         3,406         11,183         10,699   

 General and administrative

     1,202         1,140         3,126         3,262   

 

    

 

 

    

 

 

    

 

 

 

 Operating income

     5,594         5,283         16,996         17,102   

 Other income (expense), net

     322         (247)         608         (698)   

 

    

 

 

    

 

 

    

 

 

 

 Income before income taxes

     5,916         5,036         17,604         16,404   

 Provision for income taxes

     1,115         1,280         2,913         2,728   

 

    

 

 

    

 

 

    

 

 

 

 Net income

             $4,801                 $3,756                 $14,691                 $13,676   
  

 

 

    

 

 

    

 

 

    

 

 

 

 Earnings per share:

           

 Basic

     $0.62         $0.48         $1.89         $1.72   

 Diluted

     $0.61         $0.47         $1.87         $1.70   

 Weighted average shares outstanding:

           

 Basic

     7,725         7,895         7,756         7,952   

 Diluted

     7,813         7,985         7,840         8,041   

 Cash dividends declared per common share

     $0.39         $0.36         $1.17         $1.08   

 

 


MICROSOFT CORPORATION

COMPREHENSIVE INCOME STATEMENTS

(In millions)(Unaudited)

 

    

Three Months Ended

March 31,

    

Nine Months Ended 

March 31, 

 
         2017           2016           2017           2016   

 

 

 Net income

             $4,801                 $3,756                 $14,691                 $13,676   
  

 

 

    

 

 

    

 

 

    

 

 

 

 Other comprehensive income (loss):

           

 Net unrealized gains (losses) on derivatives (net of tax effects of $1, $(30), $(1), and $(2))

     (225)         (285)         18         (277)   

 Net unrealized gains (losses) on investments (net of tax effects of $34, $186, $(457), and $(36))

     65         345         (846)         (66)   

 Translation adjustments and other (net of tax effects of $0, $3, $7, and $(18))

     292                (65)         (339)   

 

    

 

 

    

 

 

    

 

 

 

 Other comprehensive income (loss)

     132         67         (893)         (682)   

 

    

 

 

    

 

 

    

 

 

 

 Comprehensive income

     $4,933         $3,823         $13,798         $12,994   
  

 

 

    

 

 

    

 

 

    

 

 

 


MICROSOFT CORPORATION

BALANCE SHEETS

(In millions)(Unaudited)

 

    

March 31, 

2017 

    

June 30, 

2016 

 

 

 

 Assets

     

 Current assets:

     

 Cash and cash equivalents

     $6,713         $6,510   

 Short-term investments (including securities loaned of $4,462 and $204)

     119,305         106,730   

 

    

 

 

 

 Total cash, cash equivalents, and short-term investments

     126,018         113,240   

 Accounts receivable, net of allowance for doubtful accounts of $302 and $426

     12,882         18,277   

 Inventories

     1,979         2,251   

 Other

     5,434         5,892   

 

    

 

 

 

 Total current assets

     146,313         139,660   

 Property and equipment, net of accumulated depreciation of $22,992 and $19,800

     21,962         18,356   

 Equity and other investments

     7,381         10,431   

 Goodwill

     34,668         17,872   

 Intangible assets, net

     10,547         3,733   

 Other long-term assets

     4,146         3,416   

 

    

 

 

 

 Total assets

     $225,017         $193,468   
  

 

 

    

 

 

 

 Liabilities and stockholders’ equity

     

 Current liabilities:

     

 Accounts payable

     $6,217         $6,898   

 Short-term debt

     7,187         12,904   

 Current portion of long-term debt

     599          

 Accrued compensation

     4,604         5,264   

 Income taxes

     654         580   

 Short-term unearned revenue

     26,518         27,468   

 Securities lending payable

     201         294   

 Other

     6,025         5,949   

 

    

 

 

 

 Total current liabilities

     52,005         59,357   

 Long-term debt

     76,222         40,557   

 Long-term unearned revenue

     9,215         6,441   

 Deferred income taxes

     465         1,476   

 Other long-term liabilities

     17,381         13,640   

 

    

 

 

 

 Total liabilities

     155,288         121,471   

 

    

 

 

 

 Commitments and contingencies

     

 Stockholders’ equity:

     

 Common stock and paid-in capital - shares authorized 24,000; outstanding 7,723 and 7,808

     68,554         68,178   

 Retained earnings

     531         2,282   

 Accumulated other comprehensive income

     644         1,537   

 

    

 

 

 

 Total stockholders’ equity

     69,729         71,997   

 

    

 

 

 

 Total liabilities and stockholders’ equity

                 $225,017                     $193,468   
  

 

 

    

 

 

 


MICROSOFT CORPORATION

CASH FLOWS STATEMENTS

(In millions)(Unaudited)

 

   

Three Months Ended 

March 31, 

   

Nine Months Ended 

March 31, 

 
    2017      2016      2017      2016   

 

 

 Operations

       

 Net income

                $4,801                    $3,756                $14,691                $13,676   

 Adjustments to reconcile net income to net cash from operations:

       

 Depreciation, amortization, and other

    2,453        1,707        6,435        4,712   

 Stock-based compensation expense

    883        672        2,353        2,004   

 Net recognized losses (gains) on investments and derivatives

    (590)        65        (1,553)        216   

 Deferred income taxes

    (777)        351        (1,349)        177   

 Deferral of unearned revenue

    15,995        13,073        42,719        36,066   

 Recognition of unearned revenue

    (14,941)        (12,210)        (41,490)        (35,494)   

 Changes in operating assets and liabilities:

       

 Accounts receivable

    1,487        2,288        5,950        5,546   

 Inventories

    (16)        241        249        408   

 Other current assets

    (25)        (420)        318        (1,914)   

 Other long-term assets

    (26)              (298)        58   

 Accounts payable

    (425)        (129)        (769)        105   

 Other current liabilities

    742        626        (1,148)        (1,293)   

 Other long-term liabilities

    1,099        340        2,394        594   

 

   

 

 

   

 

 

   

 

 

 

 Net cash from operations

    10,660        10,367        28,502        24,861   

 

   

 

 

   

 

 

   

 

 

 

 Financing

       

 Proceeds from issuance (repayments) of short-term debt, maturities of 90 days or less, net

    (1,302)        2,622        (8,447)        481   

 Proceeds from issuance of debt

    547        25        42,593        13,274   

 Repayments of debt

    (211)        (900)        (4,554)        (2,771)   

 Common stock issued

    179        159        551        495   

 Common stock repurchased

    (2,062)        (3,857)        (10,023)        (12,292)   

 Common stock cash dividends paid

    (3,012)        (2,842)        (8,836)        (8,185)   

 Other

    (375)        (123)        (175)        (366)   

 

   

 

 

   

 

 

   

 

 

 

 Net cash from (used in) financing

    (6,236)        (4,916)        11,109        (9,364)   

 

   

 

 

   

 

 

   

 

 

 

 Investing

       

 Additions to property and equipment

    (1,695)        (2,308)        (5,846)        (5,688)   

 Acquisition of companies, net of cash acquired, and purchases of intangible and other assets

    (802)        (559)        (25,586)        (1,330)   

 Purchases of investments

    (43,918)        (27,341)        (147,874)        (99,661)   


 Maturities of investments

    4,860        5,192        22,234        16,229   

 Sales of investments

    36,444        19,599        117,754        76,292   

 Securities lending payable

    (1,080)        (66)        (94)        281   

 

   

 

 

   

 

 

   

 

 

 

 Net cash used in investing

    (6,191)        (5,483)        (39,412)        (13,877)   

 

   

 

 

   

 

 

   

 

 

 

 Effect of foreign exchange rates on cash and cash equivalents

    12        17              (45)   

 

   

 

 

   

 

 

   

 

 

 

 Net change in cash and cash equivalents

    (1,755)        (15)        203        1,575   

 Cash and cash equivalents, beginning of period

    8,468        7,185        6,510        5,595   

 

   

 

 

   

 

 

   

 

 

 

 Cash and cash equivalents, end of period

                $6,713                    $7,170                $6,713                $7,170   
 

 

 

   

 

 

   

 

 

   

 

 

 


MICROSOFT CORPORATION

SEGMENT REVENUE AND OPERATING INCOME (LOSS)

(In millions)(Unaudited)

 

    

Three Months Ended 

March 31, 

    

Nine Months Ended 

March 31, 

 
         2017       2016           2017           2016   

 

 

 Revenue

           

 Productivity and Business Processes

           $7,958             $6,521             $21,998             $19,517   

 Intelligent Cloud

     6,763         6,096         20,006         18,331   

 More Personal Computing

     8,836         9,539         29,953         31,474   

 Corporate and Other

     (1,467)         (1,625)         (5,324)         (4,616)   

 

    

 

 

    

 

 

    

 

 

 

 Total revenue

     $22,090         $20,531         $66,633         $64,706   
  

 

 

    

 

 

    

 

 

    

 

 

 

 Operating income (loss)

           

 Productivity and Business Processes

     $2,783         $2,981         $9,159         $9,429   

 Intelligent Cloud

     2,181         2,176         6,637         7,135   

 More Personal Computing

     2,097         1,751         6,524         5,154   

 Corporate and Other

     (1,467)         (1,625)         (5,324)         (4,616)   

 

    

 

 

    

 

 

    

 

 

 

 Total operating income

                 $5,594                     $5,283                     $16,996                     $17,102   
  

 

 

    

 

 

    

 

 

    

 

 

 
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