Microsoft has reported a decline in its profits as a result of costs related to job cuts and its purchase of Nokia’s smartphone business earlier this year.
However, the tech giant reported higher-than-expected quarterly revenue, helped by stronger sales of its phones, Surface tablets and cloud-computing products for companies, while keeping its profit margins largely intact.
Microsoft made $4.5 billion in Q3 2014, 13% lower than the same time last year.
“Integrations and restructuring expenses” cost $1.1 billion, Microsoft said.
However, the new Nokia business also boosted revenues. They climbed 25% to $23.2 billion, beating expectations and sending shares higher in after-hours trading.
In July Microsoft announced plans to cut 18,000 jobs, including 12,500 in the Nokia unit it bought in April.
On October 22 Microsoft said it would no longer use the Nokia name, selling future Lumia smartphone models as Microsoft-branded phones.
Microsoft made $4.5 billion in Q3 2014, 13 percent lower than the same time last year
Microsoft CEO Satya Nadella said the company was being “positioned for future growth”.
“Our teams are delivering on our core focus of reinventing productivity and creating platforms that empower every individual and organization,” he said in a statement accompanying earnings.
Microsoft makes most of its money selling software to companies. The results show a strong growth in its business selling cloud computing to companies – an area Satya Nadella has cited as important for the future of Microsoft.
The business has continued to place great importance on its consumer products like the Xbox games console, its Surface range of tablet computers, and smartphones.
Stronger sales of phones and tablets helped boost revenues, with total consumer revenue up 47%.
Microsoft shares, which have climbed 33% over the past year, rose another 3% in after-hours trading to $46.36.
Microsoft CEO Satya Nadella has apologized for remarks he made advising women not to ask for a pay rise but to have “faith in the system”.
At a conference to celebrate women in technology, Satya Nadella suggested that women not asking for a rise were “good karma”.
The comments sparked outrage and Satya Nadella has now apologized.
In an email to Microsoft staff, Satya Nadella said he answered the question “completely wrong” and “wholeheartedly” supported programs to close the pay gap.
At the conference, called the Grace Hopper Celebration of Women in Computing, the Microsoft boss said: “It’s not really about asking for the raise, but knowing and having faith that the system will actually give you the right raises as you go along.
“Because that’s good karma. It’ll come back because somebody’s going to know that’s the kind of person that I want to trust.”
Microsoft CEO Satya Nadella has apologized for remarks he made advising women not to ask for a pay rise
The interviewer at the event, Maria Klawe, president of Harvey Mudd College and a Microsoft director, immediately disagreed with him. Instead, she suggested women do their homework on salary levels and then practice asking for pay rises.
The comments caused a furor on Twitter and Saty Nadella later tweeted that he was “inarticulate” in his answer about how women should ask for a pay increase.
That was then followed up with an email to staff in which he said: “Maria asked me what advice I would offer women who are not comfortable asking for pay raises. I answered that question completely wrong.
“Without a doubt, I wholeheartedly support programs at Microsoft and in the industry that bring more women into technology and close the pay gap. I believe men and women should get equal pay for equal work.
“And when it comes to career advice on getting a raise when you think it’s deserved, Maria’s advice was the right advice. If you think you deserve a raise, you should just ask.”
Indian-born Satya Nadella became Microsoft CEO earlier this year, taking over from Steve Ballmer.
Satya Nadella will be Microsoft’s next chief executive, the technology giant has announced.
Indian-born Satya Nadella is currently Microsoft’s head of Cloud and Enterprise, which builds and runs the firm’s computing platforms and developer tools.
Satya Nadella takes over from Steve Ballmer who announced plans to step down last year.
Company’s founder Bill Gates said there was “no better person to lead Microsoft”.
Bill Gates is stepping down as chairman, it was also announced, but will take up a new role as a technology adviser and will also retain a seat on Microsoft’s board.
Microsoft’s lead independent director John Thompson will take over as chairman.
“Microsoft is one of those rare companies to have truly revolutionized the world through technology, and I couldn’t be more honored to have been chosen to lead the company,” said Satya Nadella.
“The opportunity ahead for Microsoft is vast, but to seize it, we must focus clearly, move faster and continue to transform. A big part of my job is to accelerate our ability to bring innovative products to our customers more quickly.”
Satya Nadella will be Microsoft’s next chief executive
Satya Nadella, 46, is Microsoft’s third chief executive. The Hyderabad-born executive joined the company in 1992 and has degrees in electronics, computer science and business administration.
He previously led its server and tools business before being put in charge of the unit that built Microsoft’s Cloud OS service, which powers products such as Bing, Skype and Xbox Live.
“During this time of transformation, there is no better person to lead Microsoft than Satya Nadella,” said Bill Gates.
“Satya is a proven leader with hard-core engineering skills, business vision and the ability to bring people together. His vision for how technology will be used and experienced around the world is exactly what Microsoft needs as the company enters its next chapter of expanded product innovation and growth.”
Bill Gates’ appointment as a technology adviser is seen as significant, suggesting he may again take a more hands-on role in the company he founded nearly 40 years ago.
Satya Nadella’s appointment ends months of speculation over who would succeed Steve Ballmer, who announced his intention to stand down in August last year.
At one stage incoming chairman John Thompson said more than 100 possible candidates had been identified.
Rumored to be among them were the boss of car giant Ford, Alan Mulally, and Nokia chief executive Stephen Elop.
Investors have been calling for new leadership at the Microsoft, saying it needs a significant shakeup in order to become more innovative and profitable.