Microsoft Profit Surges On Fast-Growing Cloud Business

(RTTNews) - Software giant Microsoft Corp. (MSFT), Thursday reported a surge in profit for the fourth-quarter that trumped analysts' estimates, driven largely by strong growth in cloud business.

Redmond, Washington-based Microsoft's fourth-quarter profit rose to $6.51 billion or $0.83 per share from last year's profit of $3.12 billion or $0.39 per share.

Excluding one-time items, adjusted earnings for the quarter were $0.98 per share, up from $0.69 per share last year. On average, 28 analysts polled by Thomson Reuters expected earnings of $0.71 per share for the quarter.

Revenues for the quarter rose to $23.32 billion from $20.61 billion last year. Adjusted revenues for the quarter were $24.70 billion. Analysts had a consensus revenue estimate of $24.27 billion for the quarter.

Intelligent Cloud segment, which includes its Azure on-demand computing services, revenues increased 11 percent to $7.43 billion, with Azure revenues surging 97 percent.

Under Satya Nadella, Microsoft has been transforming itself and focusing more on cloud-based services as PC shipments continue to drop.

Revenues in productivity and business processes jumped 21 percent to $8.45 billion. Revenues in More Personal Computing segment, which includes Windows operating system, declined 2 percent to $8.82 billion.

Worldwide shipments of traditional PCs--desktop, notebook, workstation- totaled 61.1 million units in the second quarter, a 4.3 percent decline from last year, according to Gartner Inc.

Worldwide spending on public cloud services and infrastructure is forecast to reach $266 billion in 2021, according to the latest update to the International Data Corporation (IDC). The United States will be the largest market for public cloud services accounting for more than 60% of worldwide revenues throughout the forecast and total spending of $163 billion in 2021.

MSFT closed Thursday's trading at $74.22, up $0.36 or 0.49% on the Nasdaq. The stock further gained $1.01 or 1.36% in the after-hours trade.