Microsoft Surface sales increase as firm prepares to launch Surface Pro LTE

Sales were up 12 per cent during the past quarter

MICROSOFT DELIVERED better-than-expected earnings for the past quarter, driven by strong growth Surface and cloud computing businesses.

The firm announced on Thursday that its saw Surface revenues increase 12 per cent during the past quarter, which it’s crediting to the newly released Surface Laptop.

This is the first time Surface sales have been on the up for some time. In the fourth quarter Microsoft’s Surface revenue slumped two per cent, which the firm at the time attributed to “product lifecycle transitions”, but this was a huge improvement on the previous quarter when Surface revenues dived by 26 per cent.

This first quarter revenue bump comes just days before Microsoft is expected to launch an LTE version of its Surface Pro hybrid, and makes talk of the firm killing off its laptop line-up seem (even more) unlikely.

Elsewhere in Microsoft’s Q1 earnings, cloud revenue continues to dominate. The firm said its “cloud technologies” now accounts for some $20bn, driven largely by Azure revenues which saw an increase of 90 per cent compared to this time last year. Office 365 revenues were also up 42 per cent, with consumer subscriptions increasing to 28 million.

“This quarter we exceeded $20bn in commercial cloud ARR, outpacing the goal we set just over two years ago,” said Satya Nadella, chief executive officer at Microsoft.

“Our results reflect accelerating innovation and increased usage and engagement across our businesses as customers continue to choose Microsoft to help them transform.”

Microsoft’s gaming division didn’t see such impressive gains, with revenue increasing just one per cent. However, Microsoft said that, while it doesn’t appear to be flogging many consoles, revenue from Xbox software increased by 21 per cent during the past quarter.

LinkedIn, which Microsoft acquired last year, contributed revenue of $1.1bn during the quarter.

Overall, Microsoft took home Q1 revenues of $24.4bn for Q1 2018, an increase of 12 per cent year-on-year, while profits increased 16 per cent to $6.6bn.