- Microsoft’s cloud revenue growth rate stabilized after three consecutive quarterly contractions, according to the company’s Tuesday earnings report for Q3 2023, the three-month period ending March 31.
- The hyperscaler posted $28.5 billion in cloud revenue, up 22% year over year, the same growth rate reported in the previous quarter’s earnings.
- As economic uncertainty persists, Microsoft remains committed to “helping customers use the breadth and depth of the Microsoft Cloud to get the most value out of their digital spend,” CEO Satya Nadella said during a Tuesday earnings call.
Cloud continued to drive revenue for Microsoft, even as generative AI advances did more to boost the company’s profile during the first three months of the year. Overall revenues grew by 7% year over year.
Microsoft’s reported only modest year-over-year revenue growth of 2% last quarter.
Azure and other cloud services saw year-over-year revenue growth of 27% and office commercial products and cloud services were up 13%, as the company’s cloud businesses posted gains across the board.
The stabilization in cloud revenue growth helped offset acute contractions in Microsoft’s devices business, which was down 30% year over year, and in Windows OEM, where revenue decreased 28%.
As the combined impacts of sustained inflation, rising interest rates and a slowing economy continue to push companies to more closely scrutinize tech purchases, Microsoft renewed its pledge to assist.
Incentivizing its people to help customers with optimization is the best way to secure loyalty and long-term contracts, Nadella said. “That’s sort of the fundamental benefit of public cloud, and we’re taking every opportunity to prove that out with customers in real time,” he said.