MSFT Microsoft Corporation

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) October 30, 2024

Microsoft Corporation

Washington		001-37845		91-1144442
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

One Microsoft Way, Redmond, Washington 98052-6399

(425) 882-8080

www.microsoft.com/investor

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:
Title of each class		Trading Symbol		Name of exchange on which registered
Common stock, $0.00000625 par value per share		MSFT		Nasdaq
3.125% Notes due 2028		MSFT		Nasdaq
2.625% Notes due 2033		MSFT		Nasdaq

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

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Item 2.02.	Results of Operations and Financial Condition

On October 30, 2024, Microsoft Corporation issued a press release announcing its financial results for the fiscal quarter ended September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this report.

In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01.	Financial Statements and Exhibits

(d) Exhibits:

	99.1	Press release, dated October 30, 2024, issued by Microsoft Corporation
	104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		MICROSOFT CORPORATION
Date: October 30, 2024		/s/ ALICE L. JOLLA
		Alice L. Jolla
		Corporate Vice President and Chief Accounting Officer

 

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Exhibit 99.1

Microsoft Cloud Strength Drives First Quarter Results

REDMOND, Wash. — October 30, 2024 — Microsoft Corp. today announced the following results for the quarter ended September 30, 2024, as compared to the corresponding period of last fiscal year:

“AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process,” said Satya Nadella, chairman and chief executive officer of Microsoft. “We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage.”

“Strong execution by our sales teams and partners delivered a solid start to our fiscal year with Microsoft Cloud revenue of $38.9 billion, up 22% year-over-year,” said Amy Hood, executive vice president and chief financial officer of Microsoft.

Business Highlights

Revenue in Productivity and Business Processes was $28.3 billion and increased 12% (up 13% in constant currency), with the following business highlights:

Revenue in Intelligent Cloud was $24.1 billion and increased 20% (up 21% in constant currency), with the following business highlights:

Revenue in More Personal Computing was $13.2 billion and increased 17%, with the following business highlights:

Microsoft returned $9.0 billion to shareholders in the form of dividends and share repurchases in the first quarter of fiscal year 2025.

 

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Business Outlook

Microsoft will provide forward-looking guidance in connection with this quarterly earnings announcement on its earnings conference call and webcast.

Quarterly Highlights, Product Releases, and Enhancements

Every quarter Microsoft delivers hundreds of products, either as new releases, services, or enhancements to current products and services. These releases are a result of significant research and development investments, made over multiple years, designed to help customers be more productive and secure and to deliver differentiated value across the cloud and the edge.

Here are the major product releases and other highlights for the quarter, organized by product categories, to help illustrate how we are accelerating innovation across our businesses while expanding our market opportunities.

Environmental, Social, and Governance (ESG)

To learn more about Microsoft’s corporate governance and our environmental and social practices, please visit our investor relations Board and ESG website and reporting at Microsoft.com/transparency.

Webcast Details

Satya Nadella, chairman and chief executive officer, Amy Hood, executive vice president and chief financial officer, Alice Jolla, chief accounting officer, Keith Dolliver, corporate secretary and deputy general counsel, and Brett Iversen, vice president of investor relations, will host a conference call and webcast at 2:30 p.m. Pacific time (5:30 p.m. Eastern time) today to discuss details of the company’s performance for the quarter and certain forward-looking information. The session may be accessed at http://www.microsoft.com/en-us/investor. The webcast will be available for replay through the close of business on October 30, 2025.

Constant Currency

Microsoft presents constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the comparative period rather than the actual exchange rates in effect during the respective periods. All growth comparisons relate to the corresponding period in the last fiscal year. Microsoft has provided this non-GAAP financial information to aid investors in better understanding our performance. The non-GAAP financial measures presented in this release should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.

Financial Performance Constant Currency Reconciliation

		Three Months Ended September 30,
($ in millions, except per share amounts)		Revenue		Operating Income		Net Income		Diluted Earnings per Share
2023 As Reported (GAAP)		$56,517		$26,895		$22,291		$2.99
2024 As Reported (GAAP)		$65,585		$30,552		$24,667		$3.30
Percentage Change Y/Y (GAAP)		16%		14%		11%		10%
Constant Currency Impact		$(217)		$(181)		$78		$0.01
Percentage Change Y/Y Constant Currency		16%		14%		10%		10%

 

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Segment Revenue Constant Currency Reconciliation

		Three Months Ended September 30,
($ in millions)		Productivity and Business Processes		Intelligent Cloud		More Personal Computing
2023 As Reported (GAAP)		$25,226		$20,013		$11,278
2024 As Reported (GAAP)		$28,317		$24,092		$13,176
Percentage Change Y/Y (GAAP)		12%		20%		17%
Constant Currency Impact		$(128)		$(72)		$(17)
Percentage Change Y/Y Constant Currency		13%		21%		17%

We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.

Selected Product and Service Revenue Constant Currency Reconciliation

		Three Months Ended September 30, 2024
		Percentage Change Y/Y (GAAP)		Constant Currency Impact		Percentage Change Y/Y Constant Currency
Microsoft Cloud		22%		0%		22%
Microsoft 365 Commercial products and cloud services		13%		1%		14%
Microsoft 365 Commercial cloud		15%		1%		16%
Microsoft 365 Consumer products and cloud services		5%		1%		6%
Microsoft 365 Consumer cloud		6%		1%		7%
LinkedIn		10%		(1)%		9%
Dynamics products and cloud services		14%		0%		14%
Dynamics 365		18%		1%		19%
Server products and cloud services		23%		0%		23%
Azure and other cloud services		33%		1%		34%
Windows OEM and Devices		2%		0%		2%
Xbox content and services		61%		0%		61%
Search and news advertising excluding traffic acquisition costs		18%		1%		19%

 

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

Forward-Looking Statements

Statements in this release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors such as:

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For more information about risks and uncertainties associated with Microsoft’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of Microsoft’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting Microsoft’s Investor Relations department at (800) 285-7772 or at Microsoft’s Investor Relations website at http://www.microsoft.com/en-us/investor.

All information in this release is as of September 30, 2024. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.

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For more information, press only:

Microsoft Media Relations, WE Communications for Microsoft, (425) 638-7777, rrt@we-worldwide.com

For more information, financial analysts and investors only:

Brett Iversen, Vice President, Investor Relations, (425) 706-4400

Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://www.microsoft.com/news. Web links, telephone numbers, and titles were correct at time of publication, but may since have changed. Shareholder and financial information, as well as today’s 2:30 p.m. Pacific time conference call with investors and analysts, is available at http://www.microsoft.com/en-us/investor.

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MICROSOFT CORPORATION

 

INCOME STATEMENTS

(In millions, except per share amounts) (Unaudited)

 

		Three Months Ended September 30,
		2024		2023
Revenue:
Product		$15,272		$15,535
Service and other		50,313		40,982
Total revenue		65,585		56,517
Cost of revenue:
Product		3,294		3,531
Service and other		16,805		12,771
Total cost of revenue		20,099		16,302
Gross margin		45,486		40,215
Research and development		7,544		6,659
Sales and marketing		5,717		5,187
General and administrative		1,673		1,474
Operating income		30,552		26,895
Other income (expense), net		(283)		389
Income before income taxes		30,269		27,284
Provision for income taxes		5,602		4,993
Net income		$24,667		$22,291
Earnings per share:
Basic		$3.32		$3.00
Diluted		$3.30		$2.99
Weighted average shares outstanding:
Basic		7,433		7,429
Diluted		7,470		7,462

 

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COMPREHENSIVE INCOME STATEMENTS

(In millions) (Unaudited)

 

		Three Months Ended
		September 30,
		2024		2023
Net income		$24,667		$22,291
Other comprehensive income (loss), net of tax:
Net change related to derivatives		(10)		21
Net change related to investments		1,114		(260)
Translation adjustments and other		304		(355)
Other comprehensive income (loss)		1,408		(594)
Comprehensive income		$26,075		$21,697

 

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BALANCE SHEETS

(In millions) (Unaudited)

 

		September 30, 2024		June 30, 2024
Assets
Current assets:
Cash and cash equivalents		$20,840		$18,315
Short-term investments		57,588		57,228
Total cash, cash equivalents, and short-term investments		78,428		75,543
Accounts receivable, net of allowance for doubtful accounts of $647 and $830		44,148		56,924
Inventories		1,626		1,246
Other current assets		25,724		26,021
Total current assets		149,926		159,734
Property and equipment, net of accumulated depreciation of $80,517 and $76,421		152,863		135,591
Operating lease right-of-use assets		20,528		18,961
Equity and other investments		15,778		14,600
Goodwill		119,374		119,220
Intangible assets, net		26,751		27,597
Other long-term assets		37,793		36,460
Total assets		$523,013		$512,163
Liabilities and stockholders' equity
Current liabilities:
Accounts payable		$22,768		$21,996
Short-term debt		0		6,693
Current portion of long-term debt		2,249		2,249
Accrued compensation		8,326		12,564
Short-term income taxes		9,717		5,017
Short-term unearned revenue		53,026		57,582
Other current liabilities		19,114		19,185
Total current liabilities		115,200		125,286
Long-term debt		42,868		42,688
Long-term income taxes		24,452		27,931
Long-term unearned revenue		2,663		2,602
Deferred income taxes		2,581		2,618
Operating lease liabilities		16,361		15,497
Other long-term liabilities		31,165		27,064
Total liabilities		235,290		243,686
Commitments and contingencies
Stockholders' equity:
Common stock and paid-in capital - shares authorized 24,000; outstanding 7,436 and 7,434		102,976		100,923
Retained earnings		188,929		173,144
Accumulated other comprehensive loss		(4,182)		(5,590)
Total stockholders' equity		287,723		268,477
Total liabilities and stockholders' equity		$523,013		$512,163

 

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CASH FLOWS STATEMENTS

(In millions) (Unaudited)

 

		Three Months Ended
		September 30,
		2024		2023
Operations
Net income		$24,667		$22,291
Adjustments to reconcile net income to net cash from operations:
Depreciation, amortization, and other		7,383		3,921
Stock-based compensation expense		2,832		2,507
Net recognized losses (gains) on investments and derivatives		(125)		14
Deferred income taxes		(1,433)		(568)
Changes in operating assets and liabilities:
Accounts receivable		14,037		11,034
Inventories		(373)		(505)
Other current assets		(82)		(796)
Other long-term assets		(1,761)		(2,013)
Accounts payable		(916)		1,214
Unearned revenue		(5,553)		(4,126)
Income taxes		1,016		1,425
Other current liabilities		(5,479)		(4,106)
Other long-term liabilities		(33)		291
Net cash from operations		34,180		30,583
Financing
Proceeds from issuance (repayments) of debt, maturities of 90 days or less, net		(5,746)		18,692
Proceeds from issuance of debt		0		7,073
Repayments of debt		(966)		(1,500)
Common stock issued		706		685
Common stock repurchased		(4,107)		(4,831)
Common stock cash dividends paid		(5,574)		(5,051)
Other, net		(889)		(307)
Net cash from (used in) financing		(16,576)		14,761
Investing
Additions to property and equipment		(14,923)		(9,917)
Acquisition of companies, net of cash acquired, and purchases of intangible and other assets		(1,849)		(1,186)
Purchases of investments		(1,620)		(8,460)
Maturities of investments		2,136		15,718
Sales of investments		1,968		5,330
Other, net		(913)		(982)
Net cash from (used in) investing		(15,201)		503
Effect of foreign exchange rates on cash and cash equivalents		122		(99)
Net change in cash and cash equivalents		2,525		45,748
Cash and cash equivalents, beginning of period		18,315		34,704
Cash and cash equivalents, end of period		$20,840		$80,452

 

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SEGMENT REVENUE AND OPERATING INCOME

(In millions) (Unaudited)

 

		Three Months Ended
		September 30,
		2024		2023
Revenue
Productivity and Business Processes		$28,317		$25,226
Intelligent Cloud		24,092		20,013
More Personal Computing		13,176		11,278
Total		$65,585		$56,517
Operating Income
Productivity and Business Processes		$16,516		$14,297
Intelligent Cloud		10,503		8,908
More Personal Computing		3,533		3,690
Total		$30,552		$26,895

We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.

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v3.24.3

Document and Entity Information	Oct. 30, 2024
Entity Information [Line Items]
Document Type	8-K
Document Period End Date	Oct. 30, 2024
Entity Registrant Name	Microsoft Corporation
Entity Incorporation, State or Country Code	WA
Entity File Number	001-37845
Entity Tax Identification Number	91-1144442
Entity Address, Address Line One	One Microsoft Way
Entity Address, City or Town	Redmond
Entity Address, State or Province	WA
Entity Address, Postal Zip Code	98052-6399
City Area Code	425
Local Phone Number	882-8080
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Amendment Flag	false
Entity Central Index Key	0000789019
Common Stock [Member]
Entity Information [Line Items]
Title of 12(b) Security	Common stock, $0.00000625 par value per share
Trading Symbol	MSFT
Security Exchange Name	NASDAQ
3.125% Notes Due 2028 [Member]
Entity Information [Line Items]
Title of 12(b) Security	3.125% Notes due 2028
Trading Symbol	MSFT
Security Exchange Name	NASDAQ
2.625% Notes Due 2033 [Member]
Entity Information [Line Items]
Title of 12(b) Security	2.625% Notes due 2033
Trading Symbol	MSFT
Security Exchange Name	NASDAQ

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