Microsoft beat expectations with strong Windows revenue, but Xbox had a rough quarter

Enlarge / The 13.5-inch Microsoft Surface Laptop 3. (credit: Jeff Dunn)

Microsoft beat analyst expectations in its quarterly earnings report, achieving $33.06 billion in revenue in the start of its first 2020 fiscal quarter (which ended September 30) compared to a projected $32.23 billion.

That's a 14% increase over the same quarter the prior year. Much of the growth still came from Azure, the company's ever-expanding cloud-services platform, which saw 59% revenue growth. However, that's down just a little from the previous quarter, which saw 64% growth. Azure and other cloud services saw $10.85 billion in revenue.

That's not what disappointed analysts and investors. Most expected a similar figure as Azure's growth slows down quarter by quarter and it achieves greater market saturation. (Amazon's more popular AWS has seen slowing growth lately, too).

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