Microsoft, a company that regularly beats the most aggressive analysts when it comes to quarterly reports, mostly declined to report this time around. The wafer shortage proved to be hurting the PC market, which fell 13%, which did hurt Windows sales, with operating system segment revenue down 2% compared to the same period in 2021 (April-May).
Still, Microsoft CEO Satya Nadella noted that Windows is still doing better than it was before the pandemic and is taking market share:
“Despite the changes in the PC market this quarter, we are still seeing more PC shipments than pre-pandemic and are taking share.
Gaming was also down year over year, with revenue down 7% and Xbox hardware revenue down 11%. However, Nadella did point out that the Xbox Series S/X “The market leader for next-generation consoles in North America for three consecutive quarters” , which was the second-best April-May period ever for Xbox. Part of the reason for this drop, Microsoft says, is that the Xbox Series S/X is still fairly new and difficult to get in the same quarter of 2021. Kendra Goodenough, director of investor relations at Microsoft, explained to The Verge:
“We’re still seeing strong demand, but from the highs we’ve seen in the releases we’ve seen over the past few years.
Even with the decline, and not fully meeting analysts’ previous expectations, Microsoft still made more money than ever, with total revenue up 12% ($51.9 billion) and net income up 2% ($16.7 billion).