Microsoft profits increase 21% thanks to Office and the cloud

Deepak Gupta
Deepak Gupta January 25, 2022
Updated 2022/01/25 at 10:24 PM

Microsoft’s overall business is still going strong, even if it’s not seeing the shockingly huge profit growth it saw last year. In your Second quarter earnings report today, the company reported revenue of $51.7 billion (up 20% from last year), with profits of $18.8 billion (up 21%). As usual, Microsoft has its unstoppable cloud business to thank, as well as a decent display of its group of PCs, Office, and other business products. Its Smart Cloud business grew 26% to $18.3 billion, while its Productivity and Business group saw revenues increase 19% to $15.9 billion.

There weren’t any big weak links this quarter — even Surface revenue, which Microsoft had previously expected to drop a little, grew 8% thanks to strong Surface Laptop sales. Windows OEM revenues also increased by 25%, which is not a big surprise given that the overall PC industry is still going strong. Where the PC business goes, Microsoft’s revenues will follow, after all. When it comes to Office, the company says that consumer revenue increased by 15% and reached 56.4 million Microsoft 365 subscribers.

While Microsoft’s earnings reports have basically looked the same for the past few years — Cloud good! Recipes grow! — the company’s numbers will look a little different when it finalizes its $68.7 billion acquisition of Activision Blizzard in 2023. At the very least, we’ll see how much the new Microsoft Gaming division really helps (or hurts) Microsoft’s overall business.

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