Page 40 - SAMENA Trends - May 2020

REGIONAL & MEMBERS UPDATES SAMENA TRENDS

vice president and chief financial officer revenue increased 17% (up 20% in Enhancements
of Microsoft. “We remain committed constant currency) driven by Dynamics Every quarter Microsoft delivers hundreds
to balancing operational discipline with 365 revenue growth of 47% (up 49% in of products, either as new releases,
continued investments in key strategic constant currency) services, or enhancements to current
areas to drive future growth.” Revenue in Intelligent Cloud was $12.3 products and services. These releases
COVID-19 Impact billion and increased 27% (up 29% in are a result of significant research and
In the third quarter of fiscal year 2020, constant currency), with the following development investments, made over
COVID-19 had minimal net impact on the business highlights: multiple years, designed to help customers
total company revenue. In the Productivity • Server products and cloud services be more productive and secure and to
and Business Processes and Intelligent revenue increased 30% (up 32% in deliver differentiated value across the
Cloud segments, cloud usage increased, constant currency) driven by Azure cloud and the edge.
particularly in Microsoft 365 including revenue growth of 59% (up 61% in Here are the major product releases and
Teams, Azure, Windows Virtual Desktop, constant currency) other highlights for the quarter, organized
advanced security solutions, and Power • Enterprise Services revenue increased by product categories, to help illustrate
Platform, as customers shifted to work 6% (up 7% in constant currency) how we are accelerating innovation across
and learn from home. In the final weeks • Revenue in More Personal Computing our businesses while expanding our
of the quarter, there was a slowdown in was $11.0 billion and increased 3% market opportunities.
transactional licensing, particularly in (up 4% in constant currency), with the Environmental, Social, and Governance
small and medium businesses, and a following business highlights: (ESG)
reduction in advertising spend in LinkedIn. • Windows OEM revenue was relatively To better execute on Microsoft’s mission,
In the More Personal Computing segment, unchanged year over year we focus our Environmental, Social, and
Windows OEM and Surface benefited from • Windows Commercial products and Governance (ESG) efforts where we can
increased demand to support remote work cloud services revenue increased 17% have the most positive impact. To learn
and learn scenarios, offset in part by supply (up 18% in constant currency) more about our latest initiatives and
chain constraints in China that improved • Search advertising revenue excluding priorities, please visit our investor relations
late in the quarter. Gaming benefited from traffic acquisition costs increased 1% ESG website.
increased engagement following stay-at- • Xbox content and services revenue Constant Currency
home guidelines. Search was negatively increased 2% Microsoft presents constant currency
impacted by reductions in advertising • Surface revenue increased 1% (up 2% in information to provide a framework for
spend, particularly in the industries most constant currency) assessing how our underlying businesses
impacted by COVID-19. The effects of Return to Shareholders performed excluding the effect of foreign
COVID-19 may not be fully reflected in the Microsoft returned $9.9 billion to currency rate fluctuations. To present
financial results until future periods. shareholders in the form of share this information, current and comparative
Segment Highlights repurchases and dividends in the third prior period results for entities reporting in
Revenue in Productivity and Business quarter of fiscal year 2020, an increase of currencies other than United States dollars
Processes was $11.7 billion and increased 33% compared to the third quarter of fiscal are converted into United States dollars
15% (up 16% in constant currency), with year 2019. using the average exchange rates from
the following business highlights: Business Outlook the comparative period rather than the
• Office Commercial products and cloud Microsoft will provide forward-looking actual exchange rates in effect during the
services revenue increased 13% (up guidance in connection with this quarterly respective periods. All growth comparisons
15% in constant currency) driven by earnings announcement on its earnings relate to the corresponding period in the
Office 365 Commercial revenue growth conference call and webcast. last fiscal year. Microsoft has provided
of 25% (up 27% in constant currency) Responding to COVID-19 this non-GAAP financial information to
• Office Consumer products and cloud At Microsoft, our focus remains on ensuring aid investors in better understanding our
services revenue increased 15% (up 17% the safety of our employees, striving to performance. The non-GAAP financial
in constant currency) with continued protect the health and well-being of the measures presented in this release should
growth in Office 365 Consumer communities in which we operate, and not be considered as a substitute for, or
subscribers to 39.6 million providing technology and resources to our superior to, the measures of financial
• LinkedIn revenue increased 21% (up customers and partners to help them do performance prepared in accordance with
22% in constant currency) their best work while remote. generally accepted accounting principles
• Dynamics products and cloud services Quarterly Product Releases and (GAAP).

40 MAY 2020