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Xbox One and Surface sales push Microsoft to record revenue

Firm surprises analysts with revenue of $24.5bn
Fri Jan 24 2014, 09:52
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SOFTWARE HOUSE Microsoft exceeded analyst expectations on Thursday, reporting record second fiscal quarter revenue that the firm claimed was due to strong Xbox One and Surface sales.

The firm posted $24.5bn in revenue and more than $6.5bn profit, which saw revenue rise 14 percent from the same period last year and net income increase by 2.8 percent.

Microsoft is crediting its unexpected revenue growth primarily to strong Xbox sales after launching the Xbox One in the October to December quarter. The firm boasted that it sold 7.4 million Xbox games consoles during the quarter, 3.5 million Xbox 360 consoles and 3.9 million Xbox One consoles since that went on sale five weeks ago.

Surface tablet sales were up too, with revenue more than doubling quarter on quarter from $400m to $893m. Microsoft hasn't revealed how many Surface 2 and Surface Pro 2 tablets it sold, but claimed they have been selling better than its first Surface tablet models.

Microsoft CFO Amy Hood said, "We delivered record revenue as demand for our business offerings remains high and we made strong progress in our Devices and Consumer segment.

"These results reflect our focus on execution, cost discipline, and long-term shareholder value as we continue to drive the strategic transformation of the company."

Microsoft software sales continued to reflect the continuing decline in PC sales, with revenue from Windows sales declining three percent during the quarter. However, it noted that Windows Phone revenue increased by 50 percent during the quarter, despite Nokia having admitted that its phone sales were down over the holidays. The company boasted that Microsoft Office sales were also up during the quarter.

Microsoft also reported that cloud services to businesses and consumers posted strong growth during the quarter.

Following its earnings call on Thursday, Microsoft's share price rose by over three percent. µ


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