• MSFT started FY2022 by beating market estimates. Q1 (quarter ended September 2021) revenue surged 22% YoY to $45.3B, while EPS jumped 49% YoY to $2.71 per share.
  • Although revenue was in line with our expectations, EPS was 1% higher, amid higher than expected gross margins. Revenue was 3% higher, and EPS was 10% higher than consensus estimates.
  • Azure and cloud services continued to report strong growth. We were also pleased to see 42% YoY growth in revenue from LinkedIn – one of the fastest growing segments.
  • We expect Windows, Surface, and Xbox to experience slower revenue growth in the coming quarters due to the ongoing semiconductor shortage, which is expected to last through 2022. This will be partially offset by a 10% increase in subscription prices of Office products.
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