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Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Microsoft reported $16.458 billion in GAAP net income for the quarter ended June 30, 2021, up 47% from a year earlier. Revenue rose 21% to $46.152 billion, topping the analyst consensus cited by GeekWire. Cloud and business software powered the quarter, while investors weighed Azure’s slower constant-currency growth and the company’s future growth trajectory.
The results were announced July 27, 2021. This is Microsoft’s fiscal fourth quarter of 2021, not a report for the latest June quarter.
What Microsoft reported for fiscal Q4 2021
The headline’s “profits” means net income—not revenue, operating income, or cash flow. Microsoft’s reported figures were:
| Measure | Q4 FY2021 | Year-over-year change |
|---|---|---|
| Revenue | $46.152 billion | +21% |
| Operating income | $19.095 billion | +42% |
| GAAP net income | $16.458 billion | +47% |
| Diluted earnings per share | $2.17 | +49% |
These are the company’s GAAP results for the three months ended June 30, 2021. Net income grew faster than revenue; diluted EPS also rose faster than net income, reflecting the per-share calculation and weighted-average share count. Microsoft’s earnings release also provides adjusted and constant-currency comparisons, which are analytical measures rather than replacements for GAAP results.
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How much Microsoft beat estimates
GeekWire reported pre-release analyst expectations of about $44.1 billion in revenue and $1.90 in EPS. Against those cited consensus figures, Microsoft exceeded revenue expectations by roughly $2.05 billion and EPS expectations by $0.27. These were estimates reported by GeekWire on July 27, 2021, not a universal forecast: estimates vary across providers, analyst samples, and GAAP versus adjusted EPS definitions. GeekWire’s contemporaneous report said the highest EPS estimate in its comparison was $2.03.
Cloud was the central growth engine
Microsoft’s commercial cloud revenue rose 36% to $19.5 billion. That measure spans cloud offerings across the company; it is not an Azure-only revenue figure. Intelligent Cloud revenue increased 30% to $17.375 billion, with segment operating income of $7.8 billion, up 46%.
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Azure grew quickly, but currency changed the headline rate
Azure revenue increased 51% as reported and 45% in constant currency. Microsoft did not disclose a standalone Azure revenue total in this release, so the growth rate should not be mistaken for a dollar amount. The gap between reported and constant-currency growth also matters when comparing performance over time: exchange-rate movements lifted the reported percentage in this quarter.
Constant-currency figures remove the estimated impact of exchange-rate changes to aid comparisons. For the quarter, Microsoft reported total revenue growth of 21% as reported versus 17% in constant currency; net income growth of 47% versus 40%; and diluted EPS growth of 49% versus 42%. These comparisons help explain underlying trends, but reported GAAP results remain the financial statements’ basis.
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Office, LinkedIn, and Dynamics also advanced
Productivity and Business Processes revenue rose 25% to $14.691 billion, reflecting demand for business software and cloud subscriptions as organizations continued adopting digital-work tools.
- Office Commercial products and cloud services revenue increased 20%; Office 365 Commercial revenue increased 25%.
- LinkedIn revenue grew 46%.
- Dynamics products and cloud services revenue rose 33%, while Dynamics 365 grew 49%.
- Microsoft 365 Consumer subscribers reached 51.9 million, up 22% year over year.
The segment results show growth across several subscription and business-software lines, rather than dependence on a single product.
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Hardware and gaming results were mixed
More Personal Computing revenue increased 9% to $14.086 billion, but individual lines diverged. Search advertising revenue excluding traffic acquisition costs rose 53%, and Windows Commercial products and cloud services increased 20. At the same time, Surface revenue fell 20%, Windows OEM revenue declined 3%, and Xbox content and services revenue decreased 4%.
Microsoft cited supply-chain constraints and comparisons with the prior-year period as factors affecting Surface and Windows OEM. Early pandemic demand had boosted PC-related comparisons in the year-earlier quarter. Windows OEM reflects licensing revenue from device makers; its decline does not describe all Windows-related commercial activity, particularly with Windows Commercial products and cloud services growing.
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- Power that lasts all day – With 20 hours of battery life[3], the new Surface Laptop powers through your entire day, so you can create, work and stream from morning to night without reaching for a charger.
- Work at the speed of your ideas – Built with the latest Qualcomm Snapdragon X2 Elite (12 Core) processors, Surface Laptop delivers fast, AI‑accelerated performance—making it the most powerful Surface laptop for everything from multitasking to demanding workloads.
- The ports you need – Charge on-the-go, transfer data fast, or create the ultimate desktop set up with two USB-C / USB4[4] ports.
- Built-in AI Companion – Work smarter, create freely, and communicate with confidence—Copilot[5] on Windows 11 is always there to help.
Why the shares could fall after an earnings beat
A strong quarter against published estimates does not guarantee a rising share price. Investors also assess what results imply about future growth and compare them with expectations that may be higher than the published consensus.
GeekWire’s report on the initial after-hours reaction pointed to investor concern about Azure’s 45% constant-currency growth rate, rather than its 51% reported rate, and the lack of meaningful acceleration versus the previous quarter’s constant-currency performance. That is market interpretation reported at the time, not a company-confirmed explanation or proof that Azure missed a specific forecast. Currency affected the reported comparison, while expectations for continued cloud expansion shaped how investors read it.
Full-year context and shareholder returns
For the fiscal year ended June 30, 2021, Microsoft reported revenue of $168.088 billion, up 18%; operating income of $69.916 billion, up 32%; and GAAP net income of $61.271 billion, up 38%. Adjusted net income was $60.651 billion, up 37%.
Microsoft said annual commercial-cloud revenue exceeded $69 billion. It also said gaming, security, and LinkedIn had each surpassed $10 billion in annual revenue over the preceding three years. During Q4, the company returned $10.4 billion to shareholders through dividends and share repurchases, up 16% year over year. Those distributions provide capital-allocation context; they are separate from operating performance and do not by themselves explain the increase in quarterly profit. Microsoft’s complete release and financial tables give the underlying figures.
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