Microsoft boasts of record Q1 revenue, driven by cloud and hardware

Microsoft has announced a new record revenue for Q1 of its fiscal year (the quarter running up to the end of September).

And that revenue was $23.2 billion (£14.5 billion), with its operating income standing at $5.84 billion (£3.6 billion) for the quarter. Revenue increased by no less than 25 per cent year-on-year, but operating income was actually down 8 per cent.

Net income was $4.5 billion, which was down 14 per cent, the reason for the dip in profits being restructuring and integration expenses that came to $1.14 billion (£710 million) in the quarter. This included staff severance payments from layoffs, the write-down of certain assets, and the cost of integrating Nokia's phone division.

Diluted earnings per share for Q1 came out as $0.54 per share, better than analyst forecasts.

Microsoft noted that its Devices and Consumer revenue increased 47 per cent to $10.96 billion (£6.8 billion), including Surface revenue of $908 million (£565 million). Xbox console sales were 2.4 million, a figured which doubled year-on-year, but how many of those were the Xbox One wasn't disclosed.

Related: Nokia sheds Windows Phone to Microsoft, soars back into profit

Office 365 Home and Personal subscriptions exceeded 7 million, 25 per cent up on the previous quarter, a very impressive gain for Microsoft's cloudy office suite. Cloud strength was a theme, with commercial cloud revenue up 128 per cent, thanks to Office 365, Azure and Dynamics CRM.

Total commercial revenue increased 10 per cent to $12.28 billion (£7.7 billion), with Server products and services revenue up by 13 per cent, and Windows volume licensing revenue seeing a spurt of 10 per cent.

CEO Nadella commented: "We are innovating faster, engaging more deeply across the industry, and putting our customers at the centre of everything we do, all of which positions Microsoft for future growth. Our teams are delivering on our core focus of reinventing productivity and creating platforms that empower every individual and organisation."

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