Surface rises up
Microsoft posted a record $3.2 billion loss on revenues of $22.2 billion for the quarter ended June 30, 2015, though there's more to the story than that. Typically a company would be in big trouble if it was losing billions of dollars per quarter, but in this case, the results are indicative of a recent $7.5 billion write down Microsoft took related to its Nokia handset business.
Despite the massive loss, there are reasons for Microsoft to be optimistic. One of them is the continued rise in Surface sales. Surface revenue grew a whopping 117 percent to $888 million, which is thanks in large part to the Surface Pro 3 and Surface 3 launch. That's quite the turnaround for Microsoft's tablet efforts when you consider the $900 million charge it took on unsold Surface RT tablets just two short years ago.
Surface wasn't the only area posting gains. Microsoft's Xbox division saw revenue go up 27 percent on strong growth in consoles, Xbox Live transactions, and first party games, while search advertising revenue grew 21 percent with Bing grabbing a 20.3 percent share of the search market in the U.S.
The cloud was also kind to Microsoft. Nearly 3 million new Office 365 Consumer subscribers joined the fray, bringing the total number to 15.2 million, while commercial cloud revenue rose 88 percent.
"Our approach to investing in areas where we have differentiation and opportunity is paying off with Surface, Xbox, Bing, Office 365, Azure and Dynamics CRM Online all growing by at least double-digits," said Satya Nadella, chief executive officer at Microsoft. "And the upcoming release of Windows 10 will create new opportunities for Microsoft and our ecosystem."
These figures are the result of Nadella putting his stamp on Microsoft after inheriting a business with a shaky future from Steve Ballmer, who now owns the Los Angeles Clippers. In a recent letter to employees, Nadella warned that he would be making some "tough choices" to right the ship, which he followed through on by virtually disbanding the company's Nokia acquisition, resulting in 7,800 layoffs.
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