Slide 1: Fiscal Year 2023 Results
£8 Microsoft a Balicem@lel-lac-va Fiscal Year 2023 Results Satya Nadella Amy Hood Brett Iversen April 25, 2023
Slide 2: Forward-looking statements
This presentation contains forward-looking statements, which are any predictions, projections, or other statements about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could materially differ because of fa
Slide 3: Financial Summary and Highlights
Financial Summary and Highlights Quarterly Business Highlights Segment Financial Overview Appendix
Slide 4: FY23 Q3 Financial Summary
FY23 Q3 Financial Summary ($ in billions, except per share amounts) FY23 Q3 Growth CC Growth* Productivity and Business Processes $17.5 11% 15% Intelligent Cloud $22.1 16% 19% More Personal Computing $13.3 (9)% (1)% Revenue $52.9 7% 10% Gross margin $36.7 9% 13% Gross margin percentage 69% 1 pt Oper
Slide 5: Quarterly Commercial Highlights
Quarterly Commercial Highlights Investor Metrics FY22 Q3 FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 Commercial bookings growth (y/y) 28% / 35% 25% / 35% (3)% / 16% 7% 1 4% 11% / 12% Commercial remaining performance obligation (in billions) $155 $189 $180 $189 $196 Commercial revenue annuity mix 96% 96% 96% 96%
Slide 6: FY23 Q3 Other Financial Highlights
FY23 Q3 Other Financial Highlights Cash returned to shareholders Q Operating expenses Other income and expense Effective tax rate Q Capital expenditures Cash flow Returned $9.7 billion to shareholders with $4.6 billion in share repurchases and $5.1 billion in dividends Operating expenses were $14.4
Slide 7: FY23 Q3 Business Highlights
FY23 Q3 Business Highlights Productivity é and Business Processes Intelligent Cloud More Personal ° 2 Computing Office Commercial products and cloud services revenue increased 13% (up 17% CC) driven by Office 365 Commercial revenue growth of 14% (up 18% CC) Office Consumer products and cloud service
Slide 8: Productivity and Business Processes
Productivity and Business Processes tte Overview Investor Metrics FY22 Q3 FY22 Q4 FY23 QI FY23 Q2 FY23 Q3 Office Commercial products and cloud services revenue growth (y/y) 12% [ 14% 9% / 13% 7% [13% 7% [14% 13% /17% Office Consumer products and cloud services revenue growth (y/y) 11% / 12% 9% / 12%
Slide 9: Productivity and Business Processes Highlights
ce Productivity and Business Processes © hightights Office Commercial * Office Commercial products and cloud services revenue grew 13% (up 17% CC) * Office 365 Commercial revenue grew 14% (up 18% CC) with Office 365 Commercial seat growth of 11%, driven by small and medium business and frontline wor
Slide 10: Intelligent Cloud
Intelligent Cloud Overview Investor Metrics Server products and cloud services revenue growth (y/y) Growth rates include non-GAAP CC growth (GAAP % / CC %). Total Revenue + Revenue grew 16% (up 19% CC) driven by Azure and other cloud services Operating Income * Gross margin dollars grew 15% (up 18%
Slide 11: Intelligent Cloud Highlights
Intelligent Cloud = Highlights Server Products and Cloud Services Trended Revenue Growth * Server products and cloud services revenue grew 17% (up 21% CC) + Azure and other cloud services revenue grew 27% (up 31% CC) driven by Aeuraena) strong demand for our consumption-based services other cloud +
Slide 12: More Personal Computing
+») More Personal Computing Overview Investor Metrics FY22 Q3 FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 Windows OEM revenue growth (y/y) 11% (2)% (15)% (39)% (28)% Windows Commercial products and cloud services revenue growth (y/y) 14% / 18% 6% / 12% 8% / 15% (3)% / 3% 14% / 18% Devices revenue growth (y/y) 1
Slide 13: More Personal Computing Highlights
+2) More Personal Computing Highlights Windows + Windows OEM revenue declined 28% as elevated channel inventory levels continued to drive additional weakness beyond declining PC demand + Windows Commercial products and cloud services revenue grew 14% (up 18% CC) driven by strong renewal execution an
Slide 14: Appendix
Appendix
Slide 15: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Our presentation of third-quarter performance includes non-GAAP financial measures. The following slides provide reconciliations between the GAAP and non-GAAP financial measures presented: * Constant currency reconciliations * Cash flow reconcil
Slide 16: Constant Currency Reconciliation
Constant Currency Reconciliation Three Months Ended March 31, ans Gross Operating Operating Net Dilut ed ($ in millions, except per share amounts) Revenue . Earnings Margin Expenses Income Income per Share 2022 As Reported (GAAP) $49,360 $33,745 $13,381 $20,364 $16,728 $2.22 2023 As Reported (GAAP)
Slide 17: Constant Currency Reconciliation
Constant Currency Reconciliation Segment Revenue Three Months Ended March 31, (§ in millions) Productivity and Intelligent More Personal Business Processes Cloud Computing 2022 As Reported (GAAP) $15,789 $18,987 $14,584 2023 As Reported (GAAP) $17,516 $22,081 $13,260 Percentage Change Y/Y (GAAP) 11%
Slide 18: Constant Currency Reconciliation
Constant Currency Reconciliation Segment Gross Margin Three Months Ended March 31, 2023 Percentage Change Y/Y Percentage Change Y/Y (GAAP) Constant Currency Impact Constant Currency Productivity and Business Processes 14% 4% 18% Intelligent Cloud 15% 3% 18% More Personal Computing (2% A% (5)% Segmen
Slide 19: Constant Currency Reconciliation
Constant Currency Reconciliation Selected Product and Service Information Three Months Ended March 31, 2023 Percentage Change Y/Y (GAAP) Constant Currency Impact Pe ereent Cureny Commercial bookings 11% 1% 12% Commercial remaining performance obligation 26% 0% 26% Microsoft Cloud revenue 22% 3% 25%
Slide 20: Cash Flow Reconciliation
Cash Flow Reconciliation Three Months Ended March 31, ($ in millions) 2023 2022 Chonwe wv Net Cash from Operations (GAAP) $24,441 $25,386 (4)% Additions to Property and Equipment $(6,607) $(5,340) * Free Cash Flow $17,834 $20,046 (11)% Impact of tax payment related to the TCJA capitalization of R&D
Slide 21: Microsoft
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