Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Alphabet. Billionaires like Microsoft Corp. co-founder Bill Gates likely saw an opportunity through . Office Consumer, including Microsoft 365 Consumer subscriptions and Office licensed on-premises, and Office Consumer Services, including Skype, Outlook.com, and OneDrive. Adjusted EBITDA is projected between $380 million and $415 million, down from $453.5 million reported last year. We also sell commercial and consumer products and services directly to customers, such as cloud services, search, and gaming, through our digital marketplaces and online stores. Adjusted earnings, which exclude stock-based compensation expenses and other items, were 88 cents a share, compared with $1.32 a share in the year-ago period. To navigate it, organizations will need to embrace flexibility across their entire operating model, including the ways people work, the places they inhabit, and how they manage business process. Zacks Equity Research. Browse Earnings Releases: Browse Prior Earnings Releases: Fiscal Year. We have several partnerships with other companies, including Verizon Media Group, through which we provide and monetize search queries. A paid subscription is required for full access. The adoption of the standard did not have a material impact on our consolidated financial statements. Executive Vice President, Business Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. Our Enterprise Mobility + Security offerings also compete with products from a range of competitors including identity vendors, security solution vendors, and numerous other security point solution vendors. These efforts include increasing our representation and strengthening our culture of inclusion by doubling the number of Black and African American people managers, senior individual contributors, and senior leaders in the United States by 2025; evolving our ecosystem with our supply chain, banking partners, and partner ecosystem; and strengthening our communities by using data, technology, and partnerships to help address racial injustice and inequities of the Black and African American communities in the U.S. and improve the safety and wellbeing of our employees and their communities. Beyond our products, our operational security posture and threat intelligence help customers defend themselves. Foreign currency risks related to certain Euro-denominated debt are hedged using foreign exchange forward contracts that are designated as cash flow hedging instruments. At the platform as a service (PaaS) level, new Azure Communication Services enable developers to integrate rich communications APIs into their applications using the same infrastructure that powers Microsoft Teams. July 29, 2021. In evaluating estimated losses on these obligations, we consider factors such as the degree of probability of an unfavorable outcome and our ability to make a reasonable estimate of the amount of loss. Certain acquired net operating loss carryforwards are subject to an annual limitation but are expected to be realized with the exception of those which have a valuation allowance. Detailed breakdowns of gender, racial, and ethnic minority representation in our employee population, with data by job types, levels, and segments of our business. Our platforms and tools help drive small business productivity, large business competitiveness, and public-sector efficiency. The Zacks Consensus Estimate for revenues is pegged at $50.32 billion, implying growth of 16.82 . Once an investment is determined to be impaired, an impairment charge is recorded in other income (expense), net. Sinai Health System in New York and Kyabirwa Surgical Centre in Uganda have together, Anheuser-Busch InBevthe worlds largest brewerused Azure Digital Twins. Refer to Risk Factors in our fiscal year 2021 Form 10-K for a discussion of these factors and other risks. Three billion people around the world play games, which makes gaming the largest category in the entertainment industry. Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases. DetailPricingLevelName. Server products revenue increased 6% driven by hybrid and premium solutions, on a strong prior year comparable that benefited from demand related to SQL Server 2008 and Windows Server 2008 end of support. Business, and Chief Marketing Officer, Christopher D. Young Office Consumer Services revenue is mainly affected by the demand for communication and storage through Skype, Outlook.com, and OneDrive, which is largely driven by subscriptions, advertising, and the sale of minutes. Antitrust and unfair competition class action lawsuits were filed against us in British Columbia, Ontario, and Quebec, Canada. For those uncertain tax positions that had not been effectively settled, we evaluated whether management had appropriately considered new information that could significantly change the recognition, measurement or disclosure of the uncertain tax positions. Determination of whether products and services are considered distinct performance obligations that should be accounted for separately versus together, such as software licenses and related services that are sold with cloud-based services. Vertically integrated computer manufacturers such as Hewlett-Packard, IBM, and Oracle offer their own versions of the Unix operating system preinstalled on server hardware. We protect our intellectual property investments in a variety of ways. Microsoft is a technology company whose mission is to empower every person and every organization on the planet to achieve more. Transforming the workplace to deliver new modern, modular business applications to improve how people communicate, collaborate, learn, work, play, and interact with one another. Refer to Managements Discussion and Analysis of Financial Condition and Results of Operations for further discussion regarding the impact of COVID-19 on our fiscal year 2021 financial results. If the cost of an investment exceeds its fair value, we evaluate, among other factors, general market conditions, credit quality of debt instrument issuers, and the extent to which the fair value is less than cost. This creates an opportunity to reach new customers and increase usage and engagement with existing customers. Recent Accounting Guidance Not Yet Adopted. Segment by Type - Asset Tracking and Inventory Management Solutions Market Organizations can elect to purchase perpetual licenses or subscribe to licenses. These estimates and assumptions are affected by managements application of accounting policies, as well as uncertainty in the current economic environment due to COVID-19. Adjusted net income and adjusted diluted earnings per share (EPS) are non-GAAP financial measures which exclude tax benefits related to an India Supreme Court decision on withholding taxes in fiscal year 2021. Microsoft Experience Centers are designed to facilitate deeper engagement with our partners and customers across industries. If the cost of an investment exceeds its fair value, we evaluate, among other factors, general market conditions, credit quality of debt instrument issuers, and the extent to which the fair value is less than cost. We manage credit exposures relative to broad-based indices and to facilitate portfolio diversification. Chief Financial Officer, Gap, Inc. John W. Stanton 1,4 For multi-year agreements, we generally invoice customers annually at the beginning of each annual coverage period. The weighted average grant-date fair value of stock awards granted was $221.13, $140.49, and $107.02 for fiscal years 2021, 2020, and 2019, respectively. Revenue is up 19 percent, and net income has increased . Office Consumer products and cloud services revenue increased 10% and Microsoft 365 Consumer subscribers increased to 51.9 million. Commercial remaining performance obligation, Commercial portion of revenue allocated to remaining performance obligations, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods, Revenue from our commercial cloud business, which includes Azure, Office 365 Commercial, the commercial portion of LinkedIn, Dynamics 365, and other commercial cloud properties, Gross margin percentage for our commercial cloud business, Productivity and Business Processes and Intelligent Cloud. Each allocation is measured differently based on the specific facts and circumstances of the costs being allocated. The above table excludes shares repurchased to settle employee tax withholding related to the vesting of stock awards of $4.4 billion, $3.3 billion, and $2.7 billion for fiscal years 2021, 2020, and 2019, respectively. These obligations did not have a material impact in our consolidated financial statements during the periods presented. We have not engaged in any related party transactions or arrangements with unconsolidated entities or other persons that are reasonably likely to materially affect liquidity or the availability of capital resources. The devices and form factors customers prefer evolve rapidly, and influence how users access services in the cloud, and in some cases, the users choice of which suite of cloud-based services to use. Microsoft has introduced a Hybrid Workplace Flexibility Guide to better support managers and employees as they adapt to new ways of working that shift paradigms, embrace flexibility, promote inclusion, and drive innovation. Executive Vice President and Chief Financial Officer, Alice L. Jolla Employer-funded retirement benefits for all plans were $1.2 billion, $1.0 billion, and $877 million in fiscal years 2021, 2020, and 2019, respectively, and were expensed as contributed. As a Premium user you get access to the detailed source references and background information about this statistic. In, Microsoft. Analysts had expected a 41.4% growth in Azure, according to consensus data from . DIRECTORS AND EXECUTIVE OFFICERS OF MICROSOFT CORPORATION, Satya Nadella We distribute our devices through third-party retailers. In a time of great disruption and uncertainty, customers are looking to us to accelerate their own digital transformations as software and cloud computing play a huge role across every industry and around the world. A portion of amortization and depreciation is included with various other costs in an overhead allocation to each segment. Azure SQL Database makes it possible for customers to take SQL Server from their on-premises datacenter to a fully managed instance in the cloud to utilize built-in AI. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. We bring technology and products together into experiences and solutions that unlock value for our customers. Sales and marketing expenses include payroll, employee benefits, stock-based compensation expense, and other headcount-related expenses associated with sales and marketing personnel, and the costs of advertising, promotions, trade shows, seminars, and other programs. The fair values of these investments are determined based on valuation techniques using the best information available, and may include quoted market prices, market comparables, and discounted cash flow projections. The segment made $ 46. . 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