Windows Phone sales fell by 46%
According to PhoneDog, Microsoft's net income dropped year-on-year by 25% to 3.76 billion USD in Q1/2016. The company's total revenue now stands at 20.5 billion USD, way below Wall Street's expectations. Besides, Microsoft's shares fell by over 4 % in after-hours trading.
PhoneDog says that Microsoft's cloud computing unit, More Personal Computing, which includes products such as Windows, Surface and Windows Phone recorded a 57% increase in its operating profit in Q1/2016, while sales for consumer version of Windows jumped by 15%. However, sales for the enterprise version of Windows dropped by 11%. According to tech experts, this is due to a slowdown of the global computer market and the impact of the strong dollar. Besides, Windows Phone sales fell by 46% in Q1/2016.
In Q1/2016, Microsoft's Intelligent Cloud unit, which includes Azure cloud service, grew by 120%. This is believed to be due to strong sales of Azure compute and SQL databases. However, the unit's total operating profit saw a 14% drop compared to the same period last year.
The Productivity and Business Processes Unit, on the other hand, saw a 53% rise due to strong sales of Office 365 to businesses. According to Microsoft, Office 365 is now running on more than 22.2 million active PCs, but operating income still fell by 6.6 % compared to the same period last year.