Microsoft Q1 Earnings Highlights: 'AI-Driven Transformation Is Changing Work,' Company Beats Revenue, EPS Estimates

Technology giant Microsoft Corporation MSFT reported first-quarter financial results after market close Wednesday.

Here are the key highlights.

What Happened: Microsoft reported first-quarter revenue of $65.60 billion, up 16% year-over-year. The total beat a Street consensus estimate of $64.51 billion according to data from Benzinga Pro.

The company reported first-quarter earnings per share of $3.30, beating a Street consensus estimate of $3.09 per share.

Microsoft's operating income was $65.6 billion in the first quarter, up 14% year-over-year.

"AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process,” Microsoft CEO Satya Nadella said.

Revenue by segment was:

• Productivity and Business Processes: $28.3 billion, up 12% year-over-year
• Intelligent Cloud: $24.1 billion, up 20% year-over-year
• More Personal Computing: $13.2 billion, up 17% year-over-year

Within the Productivity and Business Processes segment, Microsoft 365 Commercial products and cloud services revenue was up 13% year over year, and Dynamics products and cloud services revenue was up 14% year over year.

For Intelligent Cloud, revenue from server products and cloud services was up 23% year over year, with Azure and other cloud services revenue growth up 33% year over year.

Within the More Personal Computing segment, Xbox content and services revenue was up 61% thanks to the impact of the Activision acquisition. Search and news advertising revenue, excluding traffic acquisition costs, was up 18% year over year.

Read Also: Microsoft Q1 Earnings Preview: What Investors Should Watch In Cloud, AI, Azure On Wednesday

What's Next: The company will provide an update on guidance during its earnings conference call, which can be viewed below.

"We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage," Nadella said.  

MSFT Price Action: Microsoft stock is up 1% to $436.00 in after-hours trading Wednesday, versus a 52-week trading range of $334.69 to $468.35.

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