Microsoft Q1 Profit Tops Street - Update

(RTTNews) - Software giant Microsoft Corp. (MSFT), Wednesday reported an increased first-quarter profit that also trumped Wall Street's estimates, as cloud business continues to surge.

Redmond, Washington-based Microsoft reported first-quarter profit of $8.82 billion or $1.14 per share, up from last year's $6.58 billion or $0.84 per share. On average, 29 analysts polled by Thomson Reuters expected earnings of $0.96 per share for the quarter.

Revenues for the quarter grew 19 percent to $29.08 billion from $24.54 billion last year. Analysts had a consensus revenue estimate of $27.90 billion for the quarter.

"We are off to a great start in fiscal 2019, a result of our innovation and the trust customers are placing in us to power their digital transformation," said CEO Satya Nadella. "We're excited to help our customers build the digital capability they need to thrive and grow, with a business model that is fundamentally aligned to their success."

Intelligent Cloud segment revenues, which includes its Azure on-demand computing services, increased 24 percent to $8.6 billion, with Azure revenues surging 76 percent.

Revenues in Productivity and Business Processes rose 19 percent to $9.8 billion, with office commercial products and cloud services revenue up 17 percent driven by Office 365 commercial revenue growth of 36 percent.

Revenues in More Personal Computing segment, which includes Windows operating system, increased 15 percent to $10.7 billion.

"We see continued demand for our cloud offerings, reflected in our commercial cloud revenue of $8.5 billion, up 47% year over year," said CFO Amy Hood.

Under Satya Nadella, Microsoft has been transforming itself and focusing more on cloud-based services.

MSFT closed Wednesday's trading at $102.32, down $5.78 or 5.35%, on the Nasdaq. The stock, however, gained $4.37 or 4.25% in the after-hours trade.