#microsoft-earnings

#microsoft-earnings

Microsoft reported Wednesday that its Gaming revenue fell 9 percent, while Xbox content and services revenue decreased 5 percent in the second quarter for FY 2026. During its earnings call for the quarter ended December 31, the company said its overall revenue was up 17 percent driven by its Cloud business, but the Gaming division fell across different metrics. Xbox content and services revenue was below expectations and fell 5 percent year-on-year, Microsoft CFO Amy Hood confirmed during the earnings call.

Revenue was $81.3 billion and increased 17% (up 15% in constant currency) Operating income was $38.3 billion and increased 21% (up 19% in constant currency) Net income on a GAAP basis was $38.5 billion and increased 60%, and on a non-GAAP basis was $30.9 billion and increased 23% (up 21% in constant currency) Diluted earnings per share on a GAAP basis was $5.16 and increased 60%, and on a non-GAAP basis was $4.14 and increased 24% (up 21% in constant currency) Non-GAAP results exclude the impact from investments in OpenAI, explained in the Non-GAAP Definition section below

Revenue is up 17 percent, and net income has increased by 23 percent. The holiday quarter saw PC shipments grow unexpectedly amid an ongoing RAM shortage. Microsoft's end of Windows 10 support helped push PC shipments up, but IDC revealed earlier this month that PC makers have also been aggressively pulling forward inventory to combat potential tariffs and ongoing global memory shortage.