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2% increase in revenue, 12% decrease in profit

Microsoft shared in its latest publication of results that it collected $52,7 billion in revenue during its FY23 Q2, translating to a 2% increase. However, it said its profit fell 12% to $16,4 billion during the said period.

Microsoft's latest earnings release shows the various sections where the company is succeeding and currently being challenged. Among all the details shared, the main highlight of the giant's success in the second quarter of FY23 is its intelligent cloud revenue which reached $21,5 billion, an increase of 18%, thanks to 31% growth in revenue from Azure and other cloud services. Still, it's important to note that the numbers are down from last year's second quarter, where Intelligent Cloud and Azure had 26% and 46%, respectively. On a positive note, Microsoft Cloud revenue was $27,1 billion, an increase of 22%.

Microsoft's Productivity and Business Processes segment (composed of Office Commercial Products and Cloud Services, Office Consumer Products and Cloud Services, LinkedIn and Dynamics Products and Cloud Services) generated total revenue of $17,0. $7 billion, an increase of 19%. However, it reported that its More Personal Computing segment (includes Windows OEM, Windows commercial products and cloud services, Xbox content and services, search and advertising in news and devices) took a hit by having a 14,2% drop in the second quarter when its $14,5 billion in revenue was lower than the company's estimated $14,9 billion to $39 billion. In this section, revenue from OEMs and Windows devices contributed the most to the drop, with sales of both down XNUMX% last quarter.

Another element that impacted the More Personal Computing segment was Xbox content and services, which revealed the performance of the company's gaming business in the second quarter. According to Microsoft, Xbox content and services saw a 12% drop in revenue. Still, the company expected it, given the strong demand for its gaming products and services over the past year. Compared to that, Xbox's monthly active devices and streaming hours increased, good news for Microsoft despite falling Xbox sales revenue during the period. Microsoft CEO Satya Nadella applauded this, pointing to the growth of Game Pass.

“We saw new highs for Game Pass subscriptions, game streaming hours, and monthly active devices,” Nadella said. “And monthly active users surpassed a record 120 million during the quarter. »

Overall, the report shows Microsoft's slowest growth in six years. The next quarter, however, does not look any better for the giant. As its executives believe, this could continue until March, as customers are more careful in their spending.

Despite all these challenges, the Redmond company is determined to pursue a brighter future. For now, he is still fighting for the approval of his project $69 billion with Activision it could help a lot in his gaming activity. That too licensee 10 employees recently in hopes of reducing company costs. In this regard, the company decided to take a charge of $000 billion from its second quarter earnings for severance, construction leases and “changes to our hardware portfolio.” Apart from that, the company announced this week the third phase of its "multi-billion dollar investment" in OpenAI, which aurait cost $10 billion.

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