Microsoft Q4 2022 earnings: Windows and Xbox fall in $51.9 billion quarter - The Verge
Microsoft has reported its fourth-quarter 2022 earnings. Windows, Office, and cloud services are all highlights this quarter.
Microsoft posted the fourth quarter of its 2022 financial results today, reporting revenue of $51.9 billion and a net income of $16.7 billion. Revenue is up 12 percent, and net income has increased by just 2 percent. But while revenue was up, Microsoft saw some of its core businesses, including Windows and Xbox, start to slip.
The PC market had been thriving throughout the pandemic, but PC shipments experienced a big decline in the recent quarter — nearly 13 percent according to Gartner. It’s the sharpest decline in nine years, thanks to geopolitical tensions, inflation, and continued supply chain challenges.
Microsoft’s Windows OEM revenue, the price PC manufactures pay Microsoft to put Windows on machines, fell 2 percent in Q4, driven by what Microsoft described as “production shutdowns and a deteriorating PC market.”
Photo by Becca Farsace / The Verge
“We did see the market weaken through the quarter, so that did impact our results,” says Kendra Goodenough, director of Microsoft investor relations, in a call with The Verge. Microsoft CEO Satya Nadella offered some more context on the PC market during an investors call today. “Despite a changing market for PCs during the quarter, we continue to see more PCs shipped than pre-pandemic, and are taking share,” says Nadella.
Despite the weaker PC market, Surface is doing well on the commercial side. Surface revenue has increased 10 percent for Q4, despite no big Surface launches during the quarter. “Consumer side is definitely dropping off at a faster rate when it comes to overall demand environment right now, so when we think of the commercial strength on Surface that’s where we get a little bit more help on that Surface [revenue] number,” explains Goodenough.
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