Surface and Xbox One Hits With Buyers During the Holidays

Microsoft reported better-than-expected results for its fiscal second quarter ending December 31, 2013. The company stated that it pulled in $6.56 billion, up from the $6.38 billion the company made in the same quarter last year. Revenue was also $24.52 billion, up 14 percent year over year.

"Our Commercial segment continues to outpace the overall market, and our Devices and Consumer segment had a great holiday quarter," said Microsoft CEO Steve Ballmer. "The investments we are making in devices and services that deliver high-value experiences to our customers, and the work we are doing with our partners, are driving strong results and positioning us well for long-term growth."

According to the financial report, Surface revenue more than doubled sequentially, from $400 million in the first quarter to $893 million in the second quarter. The Xbox business was rather kind to Microsoft as well, with 3.9 million Xbox One consoles sold and 3.5 million Xbox 360 consoles sold.

Check out what we thought of the Xbox One in our review here.

Microsoft reported that its Windows OEM revenue declined 3 percent (consumer), reflecting a strong 12 percent growth in Windows OEM Pro revenue (enterprise), offset by continued softness in the consumer PC market. Unfortunately, the company didn't reveal which sold better, Windows 7 or Windows 8.

Bing also saw growth, taking 18.2 percent of the search market and the revenue stemming from Bing advertisements growing to 34 percent. Overall, the Devices and Consumer revenue grew 13 percent to $11.91 billion.

"We delivered record revenue as demand for our business offerings remains high and we made strong progress in our Devices and Consumer segment,"  said Amy Hood, chief financial officer at Microsoft. "These results reflect our focus on execution, cost discipline, and long-term shareholder value as we continue to drive the strategic transformation of the company."

On a commercial level, revenue grew 10 percent to $12.67 billion. Office 365 commercial seats and Azure customers both grew triple-digits, and commercial cloud services revenue more than doubled.

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  • thdarkshadow
    Is there a number for PS4s sold? I am just curious how their sales compare
    1
  • JD88
    They failed to mention they spent more on the Surface than they took in. Surface division costed MS something like $940 million due to low margins and an extremely high advertising budget for a net loss of around $40 million.

    Those OEM Windows numbers are also troubling.
    -4
  • back_by_demand
    Quote:
    They failed to mention they spent more on the Surface than they took in. Surface division costed MS something like $940 million due to low margins and an extremely high advertising budget for a net loss of around $40 million. Those OEM Windows numbers are also troubling.
    MS has big pockets and lots of patience, probably only IBM is better at playing the long game. Exactly the same could have been said with the outlay in the first couple of years of the original Xbox. If they keep getting serious market penetration they the advertising costs can basically be swept into the margins as it helps to advertise all their other products (OneDrive, Office, etc). I'm sure Apple were saying exactly the same thing about Android just before it exploded.
    5