Microsoft announced its financial results for the first quarter of 2024. The software company reported revenues of $56.5 billion and net income of $22.3 billion, representing a 13% increase in revenue and a 27% increase in net income.
Windows OEM sales rose 4% in the quarter, a surprising result considering overall weak PC sales last year.
The decline in laptop shipments has once again impacted sales of the devices, which include HoloLens, computer accessories, and Surface devices. Total hardware sales fell 22% in the first quarter.
Xbox console sales fell 7%, while sales of Xbox content and services, including Xbox Game Pass, rose 13%.
Total gaming revenue also increased by 9%. Although Microsoft has not announced updated subscriber numbers, Xbox Game Pass appears to be growing year over year.
Xbox Game Pass subscribers rose to 25 million in January 2022, and the company hasn't provided an update to that number in more than 18 months.
The cloud, server and office divisions generate the majority of the company's revenue, with the number of Microsoft 365 consumer subscribers increasing 18% year over year to 76.7 million.
The $2 per month Microsoft 365 Basic subscription, which Microsoft introduced earlier this year, helped boost that number.
Sales of commercial office products and cloud services were up 15% year over year, while commercial sales of Office 365 were up 18%.
Microsoft continues to shift businesses to cloud versions of Office, and the launch of Microsoft 365 Copilot in November is also likely to spark renewed interest.
Microsoft Teams continues to grow and now has more than 320 million monthly active users and more than 10,000 paying customers with Microsoft Teams Premium.
This quarter, its intelligent cloud business generated revenue of $24.3 billion, up 19% year over year. Revenue from Azure and other cloud services rose 29%.
Microsoft's cloud revenues exceeded $110 billion in fiscal year 2023, with Azure representing more than 50% of those revenues for the first time, the company said.