Microsoft has continued its relentless growth in the first quarter of its fiscal year, with demand for hybrid infrastructure driving up sales.
For the three months ending 30 September, Microsoft saw revenue increase 14 per cent year on year to $33.1bn while operating income climbed 27 per cent.
The vendor saw growth across its three business areas: Productivity and Business Processes, Intelligent Cloud and More Personal Computing.
Revenue is split evenly between the three units, but the cloud division, which houses Azure, saw the strongest growth at 27 per cent.
More Personal Computing recorded the weakest growth at four per cent, with sales derived from Surface products falling four per cent.
On an earnings call, transcribed by Seeking Alpha, Microsoft CEO Satya Nadella (pictured) said:
"Our approach has always been about this distributed computing fabric or thinking about hybrid as not as some transitory phase, but as a long-term vision for how computing will meet real-world needs.
If you think about the long term, compute will migrate to wherever data is getting generated, and increasingly there will be data generated in the real world, where just when you think about the cloud, you have to think about the edge of the cloud as a very first-class construct.
"So in that context, we see a couple of things that you see even in the results today. One is the hybrid benefits. That is increasingly what is getting customers excited about the Azure choice and the fact that they can renew, knowing that they have the flexibility of both the cloud and the edge. That's definitely driving growth."
Microsoft does not disclose Azure revenue, but said that sales increased 63 per cent - the lowest growth since it started revealing the figure in Q1 2017.
The vendor however said that gross margin from its commercial cloud offerings was up four percentage points to 66 per cent, and "significant improvement in Azure gross margin offset a sales mix shift to Azure".
Microsoft's share price remained flat, with the outlook for Q2 coming in below some analysts' expectations.
Nadella however said that he expects hybrid infrastructure adoption to continue pushing sales.
"We expect another strong quarter in our commercial business," he said.
"Demand for our hybrid offerings and cloud services remained strong and capital expenditures will continue to reflect that."
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