Microsoft Q1 FY2022 Earnings Report Recap

MSFT beat on earnings and revenue

Key Takeaways

  • Azure revenue grew 48% year over (constant currency), beating analysts' expectations.
  • Azure is Microsoft's cloud computing platform, which offers a number of tools and services to meet various computing needs of developers.
  • Adjusted EPS grew at its fastest pace in at least four and a half years.
Microsoft Earnings Results
Metric Beat/Miss/Match Reported Value Analysts' Prediction
Adjusted EPS Beat $2.71 $2.08
Revenue Beat $45.3B $43.9B
YOY Growth in Microsoft Azure Revenue (constant currency) Beat 48% 45.4%

Source: Predictions based on analysts' consensus from Visible Alpha

Microsoft (MSFT) Financial Results: Analysis

Microsoft Corporation (MSFT) reported Q1 FY 2022 earnings that beat analyst expectations. Adjusted earnings per share (EPS) came in well above what analysts had forecast, rising 48.9% year over year (YOY). It was the fastest pace of adjusted EPS growth out of any quarter in at least the past four and a half years. Revenue also surpassed analyst estimates, up 22.0% compared to the year-ago quarter.

Microsoft's YOY Azure cloud revenue growth on a constant-currency basis also surpassed expectations. Microsoft does not disclose Azure revenue in dollars in its earnings report. The company's shares rose slightly in extended trading. Over the past year, Microsoft's shares have provided a total return of 49.0%, above the S&P 500's total return of 34.5%.

Note that Microsoft's 2021 fiscal year ended June 30, 2021. Its current earnings report is thus for its fiscal first quarter, which coincides with the third quarter of the calendar year.

MSFT Azure Revenue

Azure cloud revenue grew 48% YOY on a constant-currency basis, its fastest pace since the second quarter of FY 2021. Azure is Microsoft's cloud computing platform, which offers developers, IT professionals, and enterprises a suite of tools and services that can be used for networking, storage, mobile and web application services, artificial intelligence (AI), Internet of Things (IoT), and a range of other computing needs. It captured an approximately 22% share of the global cloud market as of the end of the second quarter of the 2021 calendar year. Microsoft's Azure is second only to, Inc.'s (AMZN) Amazon Web Services in terms of global cloud market share.

Microsoft's next earnings report (for Q2 FY 2022) is estimated to be released on Jan. 27, 2022.

Article Sources
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  2. Visible Alpha. "Financial Data."

  3. TradingView. "Price Chart: MSFT and S&P 500."

  4. Microsoft Corp. "Form 10-K for the fiscal year ended June 30, 2021," Page 12.

  5. Statista. "Cloud infrastructure services vendor market share worldwide from 4th quarter 2017 to 2nd quarter 2021."

  6. "Microsoft Corporation (MSFT): Financials."

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