Slide 1: Second Quarter Fiscal Year 2025 Results
EE Microsoft Second Quarter Fiscal Year 2025 Results Satya Nadella Amy Hood Brett Iversen January 29, 2025
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 All growth comparisons in this presentation relate to the corresponding period of last fiscal year unless otherwise noted. We have recast certain prior period amounts to conform to the way we internall
Slide 4: FY25 Q2 Financial Summary
FY25 Q2 Financial Summary ($ in billions, except per share amounts) FY25 Q2 Growth CC Growth* Productivity and Business Processes $29.4 14% 13% Intelligent Cloud $25.5 19% 19% More Personal Computing $14.7 0% 0% Revenue $69.6 12% 12% Gross margin $47.8 13% 12% Gross margin percentage 69% 0 pts Opera
Slide 5: Quarterly Commercial Highlights
Quarterly Commercial Highlights Investor Metrics FY24 Q2 FY24 Q3 FY24 Q4 FY25 Q1 FY25 Q2 Commercial bookings growth (y/y) 17% [9% 29% / 31% 17% / 19% 30% / 23% 67% / 75% Commercial remaining performance obligation (in billions) $222 $235 $269 $259 $298 Commercial revenue annuity mix 96% 97% 97% 98%
Slide 6: FY25 Q2 Other Financial Highlights
FY25 Q2 Other Financial Highlights Cash returned to shareholders Operating expenses Other income and expense Effective tax rate Capital expenditures Cash flow Includes non-GAAP constant currency (“C Returned $9.7 billion to shareholders with $6.2 billion in dividends and $3.5 billion in share repurc
Slide 7: FY25 Q2 Business Highlights
FY25 Q2 Business Highlights Productivity and Business Processes Intelligent Cloud More Personal Computing Additional Business Highlight Microsoft 365 Commercial products and cloud services revenue increased 15% driven by Microsoft 365 Commercial cloud revenue growth of 16% (up 15% CC) Microsoft 365
Slide 8: Productivity and Business Processes Overview
tte Investor Metrics Overview Microsoft 365 Commercial cloud revenue growth (y/y) Microsoft 365 Commercial seat growth (y/y) Microsoft 365 Consumer cloud revenue growth (y/y) Microsoft 365 Consumer subscribers (in millions) LinkedIn revenue growth (y/y) Dynamics 365 revenue growth (y/y) Growth rates
Slide 9: Productivity and Business Processes Highlights
ce Productivity and Business Processes Highlights Microsoft 365 Commercial * Microsoft 365 Commercial products and cloud services revenue grew 15% * Microsoft 365 Commercial cloud revenue grew 16% (up 15% CC) with Microsoft 365 Commercial seat growth of 7% which was driven by small and medium busine
Slide 10: Intelligent Cloud Overview
Intelligent Cloud = Overview Investor Metrics FY24 Q2 Azure and other cloud services revenue growth (y/y) 33% / 31% Trended Revenue Growth Server products revenue growth (y/y) 3% / 2% Enterprise and partner services revenue growth (y/y) 1% / 0% Growth rates include non-GAAP CC growth (GAAP % / CC %)
Slide 11: Intelligent Cloud Highlights
Intelligent Cloud = Highlights Server Products and Cloud Services * Server products and cloud services revenue grew 21% + Azure and other cloud services revenue grew 31% driven by demand for our portfolio of services, including 13 points from our Al services which grew 157% * Server products revenue
Slide 12: More Personal Computing Overview
+») More Personal Computing Overview Investor Metrics FY24 Q2 FY24 Q3 FY24 Q4 FY25 Q1 FY25 Q2 Windows OEM and Devices revenue growth (y/y) 4% 2% (1)% / 0% 2% 4% Xbox content and services revenue growth (y/y) 61% / 60% 62% / 61% 61% 61% 2% Search and news advertising revenue (ex TAC) growth (y/y) 6%
Slide 13: More Personal Computing Highlights
+2) More Personal Computing Highlights Windows OEM and Devices + Windows OEM and Devices revenue grew 4% as commercial inventory builds drove growth in Windows OEM, partially offset by a decline in Devices Gaming * Gaming revenue declined 7% (down 8% CC) * Xbox content and services revenue grew 2% d
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 second-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 reconc
Slide 16: Constant Currency Reconciliation
Constant Currency Reconciliation Three Months Ended December 31, rn Gross Operating Operating Net Dilut ed ($ in millions, except per share amounts) Revenue . Earnings Margin Expenses Income Income per Share 2023 As Reported (GAAP) $62,020 $42,397 $15,365 $27,032 $21,870 $2.93 2024 As Reported (GAAP
Slide 17: Constant Currency Reconciliation: Segment Revenue
Constant Currency Reconciliation Segment Revenue Three Months Ended December 31, in millions) Productivity and Intelligent More Personal Business Processes Cloud Computing 2023 As Reported (GAAP) $25,854 $21,525 $14,641 2024 As Reported (GAAP) $29,437 $25,544 $14,651 Percentage Change Y/Y (GAAP) 14%
Slide 18: Constant Currency Reconciliation: Segment Margin and Expenses
Constant Currency Reconciliation Segment Gross Margin Three Months Ended December 31, 2024 Percentage Change Y/Y Percentage Change Y/Y (GAAP) Constant Currency Impact Constant Currency Productivity and Business Processes 13% (1% 12% Intelligent Cloud 12% 1% 13% More Personal Computing 13% (1)% 12% S
Slide 19: Constant Currency Reconciliation: Product and Service Information
Constant Currency Reconciliation Selected Product and Service Information Three Months Ended December 31, 2024 Percentage Change V/Y (GAAP) Constant Currency Impact Percentage cense yy Commercial bookings 67% 8% 75% Commercial remaining performance obligation 34% 2% 36% Microsoft Cloud revenue 21% 0
Slide 20: Cash Flow Reconciliation
Cash Flow Reconciliation Three Months Ended December 31, . ane Percentage ( in millions) 2024 2023 Change Y/Y Net Cash from Operations (GAAP) $22,291 $18,853 18% Additions to Property and Equipment $(15,804) $(9,735) * Free Cash Flow $6,487 $9,118 (29)% *Not meaningful. Free cash flow is included as
Slide 21: EE Microsoft
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