Microsoft Lumia phone sales keep dropping rapidly

In the third quarter, which ended March 31, Microsoft's net income fell to $3.76 billion from $4.99 billion the year before.

CEO Satya Nadella said the company is seeing momentum across its cloud services and with Windows 10. Executives touted the growth and strength of the company's cloud business and noted that weaker PC sales and a strong decline in Microsoft's phone business hurt overall results.

Amy Hood, Microsoft's chief financial officer, said her company's operational and financial discipline helped drive a solid quarter.

Revenue in the "Intelligent Cloud"-the business segment that includes the Azure cloud infrastructure, services and server software-grew 3% to $6.1 billion".

Windows OEM revenue dropped 2 per cent, outperforming the remainder of the PC market.

In total, Microsoft's Productivity and Business Processes unit grew 1% (up 6% in constant currency) to $6.5 billion. "But, the combined top line and bottom line miss will raise the stakes for their final quarter of the 2016 fiscal year".

Revenue at the Redmond, Washington-based software giant fell to $20.53bn from $21.73bn.

Adjusted revenue of $22.08 billion was just shy of the $22.09 billion analysts had expected, according to Thomson Reuters I/B/E/S. Surface revenue increased 61% in constant currency and topped $1 billion for the second straight quarter for the first time outside of a holiday period, the company said. Microsoft said it was able to outperform the PC market because of a "higher consumer premium device mix".

Microsoft posted its third-quarter earnings report yesterday, revealing that the company's cloud division is its best-performing business.

The company listed a number of slight gains for the quarter, with Office commercial products and cloud services revenue up seven percent, and Office consumer products and cloud services revenue up six percent. Phone revenues were down a hefty 46 percent from a year ago.

Not surprisingly, revenue from Windows revenue declined. The company sold just 2.3 million Lumia devices in the quarter, a 73% decline from the same period a year ago.

Its Intelligent Cloud Business revenue gained 3% (8% if foreign exchange is not taken into account), which also includes Azure.

Search advertising revenue (excluding traffic acquisition costs) grew 18% in constant currency, benefiting from Windows 10 use, Microsoft said.

All in all, a pretty good quarter for Microsoft all things considered - but something clearly needs to be done about Windows Phone.

Source: Microsoft Lumia phone sales keep dropping rapidly