updated 05:34 pm EST, Thu January 23, 2014
Xbox One, Surface boost business higher than expected
Microsoft today announced revenue of $24.52 billion for the quarter ended December 31, 2013, beating revenue estimates by more than a billion dollars. Gross margin, operating income, net income, and diluted earnings per share for the quarter were $16.24 billion, $7.97 billion, $6.56 billion, and $0.78 per share, respectively.
"Our Commercial segment continues to outpace the overall market, and our Devices and Consumer segment had a great holiday quarter," said Steve Ballmer, chief executive officer at Microsoft. "The investments we are making in devices and services that deliver high-value experiences to our customers, and the work we are doing with our partners, are driving strong results and positioning us well for long-term growth."
Windows OEM revenue declined three percent, reflecting strong 12 percent growth in Windows OEM Pro revenue, offset by continued softness in the consumer PC market. Surface revenue more than doubled sequentially, from $400 million in the first quarter to $893 million in the second quarter on the strength of the Haswell-powered Surface Pro 2. The company sold 7.4 million Xbox console units into the retail channel, including 3.9 million Xbox One consoles and 3.5 million Xbox 360 consoles. Bing search share grew to 18.2 percent and search advertising revenue grew 34 percent.
Commercial revenue grew 10 percent to $12.67 billion. Microsoft's SQL Server continued to gain market share, with revenue growing double-digits. System Center also showed continued strength, with double-digit revenue growth. Commercial cloud services revenue more than doubled.