Exhibit 99.1

Microsoft Cloud Growth Fuels Second Quarter Results

Results include a net charge of $13.8 billion related to the Tax Cuts and Jobs Act

REDMOND, Wash. — January 31, 2018 — Microsoft Corp. today announced the following results for the quarter ended December 31, 2017:

 

    Revenue was $28.9 billion and increased 12%
    Operating income was $8.7 billion and increased 10%
    GAAP net loss was $(6.3) billion and non-GAAP net income was $7.5 billion
    GAAP diluted loss per share was $(0.82) and non-GAAP diluted earnings per share was $0.96
    GAAP results include a $13.8 billion net charge related to the Tax Cuts and Jobs Act (TCJA)

“This quarter’s results speak to the differentiated value we are delivering to customers across our productivity solutions and as the hybrid cloud provider of choice,” said Satya Nadella, chief executive officer of Microsoft. “Our investments in IoT, data, and AI services across cloud and the edge position us to further accelerate growth.”

The following table reconciles our financial results reported in accordance with generally accepted accounting principles (GAAP) to non-GAAP financial results. Additional information regarding our non-GAAP definition is provided below. All growth comparisons relate to the corresponding period in the last fiscal year.

 

     

Three Months Ended December 31,

 

 

   ($ in millions, except per share amounts)

 

  

  Revenue  

 

    

Operating
    Income    

 

    

Net
Income
  (Loss)  

 

    

Diluted
Earnings
(Loss)
  per Share  

 

 

 

  2016 As Reported (GAAP)

 

    

 

$25,826

 

 

 

    

 

$7,905

 

 

 

    

 

$6,267

 

 

 

    

 

$0.80

 

 

 

 

  2017 As Reported (GAAP)

 

    

 

$28,918

 

 

 

    

 

$8,679

 

 

 

    

 

$(6,302)

 

 

 

    

 

$(0.82)

 

 

 

 

    Net TCJA Impact

 

    

 

-

 

 

 

    

 

-

 

 

 

    

 

13,800

 

 

 

    

 

1.78

 

 

 

 

  2017 As Adjusted for TCJA (non-GAAP)

 

    

 

$28,918

 

 

 

    

 

$8,679

 

 

 

    

 

$7,498

 

 

 

    

 

$0.96

 

 

 

 

  Percentage Change Y/Y (GAAP)

 

    

 

12%

 

 

 

    

 

10%

 

 

 

    

 

(201%)

 

 

 

    

 

(203%)

 

 

 

 

  Percentage Change Y/Y (non-GAAP)

 

    

 

12%

 

 

 

    

 

10%

 

 

 

    

 

20%

 

 

 

    

 

20%

 

 

 

 

  Percentage Change Y/Y (non-GAAP) Constant Currency

 

    

 

11%

 

 

 

    

 

10%

 

 

 

    

 

20%

 

 

 

    

 

20%

 

 

 

GAAP results include a net charge of $13.8 billion related to TCJA, which is excluded from our non-GAAP results.

Microsoft returned $5.0 billion to shareholders in the form of share repurchases and dividends in the second quarter of fiscal year 2018.

“We delivered another strong quarter with commercial cloud revenue growing 56% year-over-year to $5.3 billion,” said Amy Hood, executive vice president and chief financial officer of Microsoft. “Strong execution from our sales teams and partners is driving growth across our businesses.”

Revenue in Productivity and Business Processes was $9.0 billion and increased 25% (up 24% in constant currency), with the following business highlights:

 

    Office commercial products and cloud services revenue increased 10% (up 10% in constant currency) driven by Office 365 commercial revenue growth of 41% (up 41% in constant currency)
    Office consumer products and cloud services revenue increased 12% (up 11% in constant currency) and Office 365 consumer subscribers increased to 29.2 million


The following information was filed by Microsoft Corp (MSFT) on Wednesday, January 31, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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