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Microsoft's commercial cloud revenue hits $38.4B run rate in Q3

Microsoft's third quarter was strong as its commercial cloud revenue continues to chug along.
Written by Larry Dignan, Contributor on
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Microsoft reported strong third quarter results as its commercial cloud revenue hit a $38.4 billion run rate.

The software and cloud giant reported third quarter net income of $8.8 billion, or $1.14 a share, on revenue of $30.6 billion, up 14 percent from a year ago.

Also: How (and why) Microsoft is looking at freelance experts 

Wall Street was expecting Microsoft to report fiscal third quarter revenue of $29.84 billion with earnings of $1 a share.

Commercial cloud revenue was $9.6 billion in the third quarter, up 41 percent from a year ago. Revenue in Microsoft's productivity and business processes unit was $10.2 billion as commercial Office revenue grew 12 percent.

Also: Microsoft is readying AI-powered Azure digital inking services

Intelligent cloud revenue was $9.7 billion, up 22 percent. Azure growth is decelerating a bit.

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Key facts and figures include:

  • Office consumer products revenue were up 12 percent. Subscribers to Office 365 Consumer were 34.2 million.
  • LinkedIn revenue was up 27 percent and Dynamics sales grew 13 percent.
  • Azure revenue was up 73 percent in the third quarter.
  • Surface revenue was up 21 percent.
  • On the Windows front, commercial products and cloud services saw revenue jump 18 percent with OEM sales up 9 percent.
  • Search advertising excluding traffic acquisition costs were up 12 percent.   
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