(Reuters) – Microsoft Corp exceeded analysts’ expectations for second-quarter revenue on Tuesday, propelled by strong demand for its cloud-based services from more businesses migrating to hybrid work models due to the pandemic.
Demand for cloud services from Microsoft and rivals Amazon.com and Alphabet Inc surged as the pandemic outbreak accelerated a shift to online.
The switch to working and learning from home also attracted more users to Microsoft’s office communication software and services such as Teams and Office 365.
Earlier this month, the company agreed to buy “Call of Duty” maker Activision Blizzard for $68.7 billion in its biggest-ever deal as part of a deeper push into gaming and a bet on building the so-called virtual world of “metaverse”.
Revenue from Microsoft’s biggest segment, which offers cloud services and includes Azure, its flagship cloud offering, rose 26%, while the business that houses its Office 365 services increased 19% in the quarter.
Net income rose to $18.77 billion, or $2.48 per share, from $15.46 billion, or $2.03 per share, a year earlier.
The company said revenue rose to $51.73 billion in the three months ended Dec. 31, from $43.08 billion a year earlier.
Analysts on average had expected revenue of $50.88 billion, according to Refinitiv data.
(Reporting by Nivedita Balu in Bengaluru; Editing by Sriraj Kalluvila)
