Microsoft Q1 solid amid Azure, Office 365, Windows Server gains

Microsoft reports with new segments as enterprise products offset Windows revenue declines.

Microsoft's fiscal first quarter results were solid as the company juggled strong cloud and commercial revenue growth, but saw Windows revenue decline 6 percent.

The software giant reported first quarter earnings of $4.6 billion, or 57 cents a share, on revenue of $20.4 billion. Non-GAAP earnings in the first quarter were 67 cents a share. Including Windows 10 revenue deferrals, Microsoft's revenue was $21.66 billion.

Wall Street was looking for first quarter earnings of 59 cents a share on revenue of $21.03 billion.

The quarter included yet another reporting structure change as Microsoft went from six units to three. While the change simplifies the financial reporting, analysts have said that the structure makes it hard to see how Windows 10 is monetized.

Here are the results from the new segments.

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Here's the breakdown of results:

  • Office 365 consumer subscribers were 18 million in the first quarter.
  • Office 365 seat growth was up 66 percent, but that's down from 74 percent growth in the fourth quarter.
  • There were more than 200 million Office downloads on iOS and Android to date.
  • Three out of every four new Dynamics CRM customers chose cloud deployments.
  • Azure compute usage more than doubled from a year ago.
  • Revenue in the more personal computing unit fell 17 percent in the quarter due to lower Windows Phone revenue.
  • Surface revenue fell to $673 million in the first quarter, down from $888 million in the fiscal fourth quarter.
  • Windows revenue was down across the board.

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