Revenue rose 12 per cent to US$24.54b.
Microsoft's fiscal first quarter earnings beat Wall Street expectation on both the top and bottom lines.
Microsoft's stock price climbed 2.8 percent to $80.97 in early after-hours trading Thursday after the results were released. The company had guided for between $23 billion and $23.7 billion, and in the year-ago quarter.
Diluted earnings per share was $0.84 and increased 17%. "A slowly improving PC environment is also a modest tailwind for Microsoft with cloud remaining the Trojan horse growth driver for Redmond over the coming years". Office consumer products and cloud revenues rose 12%, while Dynamics products and cloud revenues rose 13%, including a 69% increase in Dynamics 365 revenue.
The figure came in at $20.4 billion for the quarter.More news: Kanye West & Kim Kardashian's Cars in Bel Air Home Burglarized
Under Chief Executive Satya Nadella, Microsoft's cloud business - which includes products such as Office 365, Dynamic 365 and the flagship Azure computing platform - has emerged as a major source of growth.
Windows Phone is dead, the company's fitness-focused wristband has been axed and its streaming music service is no more, and Microsoft investors couldn't be happier with the company. "Our results reflect accelerating innovation and increased usage and engagement across our businesses as customers continue to choose Microsoft to help them transform". The business of licensing Windows out to PC manufacturers was up 4%.
In the fiscal first quarter, the two biggest pieces of Microsoft's cloud-computing operations - its Azure infrastructure services and Office 365 online-productivity business - saw revenue soar 90% and 42%, respectively. LinkedIn revenues amounted to $1.1 billion.
Surface revenue finally saw some growth, as it had been declining for a while due to the lack of new hardware.
Surface revenue increased by 12 percent driven by sales of the new Surface Laptop.
Looking at Microsoft's past year, the company pushed heavily on its cloud business, including Microsoft Azure - which saw a revenue rise of 97 percent year-over-year last quarter.