Microsoft (MSFT) 27 Jan 212021 Q2 Earnings call transcript

Greetings, and welcome to the Microsoft Fiscal Year 2021 Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Spencer, General Manager, Investor Relations. sir. you Thank

begin. You may

and thank us afternoon for you today. Good joining

Officer; with On Officer; Nadella, Accounting Deputy me Chief call Counsel. Alice Keith General Executive Chief Financial Satya Chief are the Dolliver, Hood, Officer; Jolla, and Amy

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everyone. And you, Satya. Thank good afternoon,

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and expect to deliver margin of COVID the performance to the excluding we changing with for our healthy a of with large full estimate will a half in broadly tax unique, full delivering double-digit Investments even change our half XX%. lower as We income Mike, on revenue rate rate the value against that call; have closing, In boldly go compelling FYXX made operating teams and impact execution of the services and finally, QX we for operating well markets roadmap our that challenging of after year today growth creating well customers of Satya of portfolio the With and products our and for expansion are be outlook for products coupled significant continue is expect span focused we that integrated as discussed savings. invest to the strong by our in year another and first in and fiscal related in the us. tomorrow. environment. executed set year fiscal approximately than and to growth quarters ahead behind our drivers first accounting years over of the slightly opportunities and XX% QX earlier often approximately Q&A let's and our in year our our optimism comprehensive And

Well others comes we'll now on to question. conducting Thank Operator Research. We'll call [Operator Q&A. you the proceed could a requested with to now Out move respect Our question ask one Instructions] and participants repeat of Please Moerdler Thanks question over Amy. be of Bernstein first the only session. answer please instructions? your you. question. please your from line Mark with

such seem question seeing feel those numbers? behind the of two now on impact taking are to the impact Thanks. the we any to meaningful we COVID you as tougher to and beat did the the is and parts you the Thank COVID build from Amy there comps that congratulations you larger tougher that allows Two my part should basically and questions the comps. one or It Satya not whole and is for demand be every team on great quarter. seems business almost like

you I'll Amy can add to Mark. Thanks it. and Maybe start

changed we're think core to is structurally resilience digital deal going I the our the COVID behavior seeing but technology our a a for even and the constraints one of is expectations. continuity be has and all is things to that lot and change what of becoming is structural one with the customer business impact critical customers on put

So what obviously and at look for I industries Mark do focused importantly all when technology the will that's in. me and you to comprehensive XX are more infrastructure across that's as a very-very next staying the we that that compute opportunity of with and years solutions what digital investing saw company on I industry the this portfolio differentiated quarter tech way applications, from business but

support with them the And Mark couple half some question a particularly of I particular second of end think are another I did and two would QX are don't sure and support maybe think strong of those make your so for on-[prem] and out. pro number the of in past why we to the the call end on have number the most being to it's in mentioned I server comparables OEM for we QX I that tougher

much Thank congratulations. safe. very stay and you Again

Operator question Thanks Mark. next please. take we'll

you. Thank

next with of proceed Jefferies. line Brent Our the with question. comes question Thill your from Please

you a talk seeing re-acceleration anything highlight and business. putting Azure this quarter accelerating why transactions the you're Thank the you're think in you. just that size Thank what in of breadth terms you. great you up seeing to and of else maybe can is to the the important

Brent. to Amy with the dev the to their value it's retail DB platform would are every and Thanks hybrid comes of their power own say all that price Azure or agility we to and the customers Azure well whether to highly differentiation with are can the as in products as I'll advantage build new capability. other or and layer with the that with differentiation I Maybe time start leading to -- and stack to to Github healthcare apps importantly layer it in integration leadership we Power the ability again have differentiated Teams of digital marketplace our data some add. the competitive in you solutions cost when industry now most of core have our some again

value think that's to parts together So cloud acceleration but differentiation azure customers. we we think about Microsoft and the what the all around see deliver to you about our coming when in

had and really little some maybe commitment. recovery it is and more and saw of describe good of and not that of and quarter to saw far make consumption QX including sure that that quarter fundamental shape we're Brent clear Azure what a which some future In been on being about this the to we thoughts a growth we even on consumption obviously re-acceleration curves really segment-based size bit of I of is just so hit some couple reflective in and and growth the maybe frankly important are in that front. QX transactions a bookings signed comments way more you there, some drivers And and on add particularly would had hard industries mid-market

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you. Thank

next Thanks question Brent. we'll take Operator please.

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with Our line the Karl with Please UBS. question comes of proceed next Keirstead from your question.

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have consistent components execution. better As you sort heard of to actually slightly in almost QX all the

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Operator take please. Karl. question we'll Thanks next the

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through channel kind framework Excellent. and very Microsoft pulling Thank and working of a and the you to of a the people I introduction sort doing in competitor's wanted about solutions quarter. people a into of taking dynamic lot me a into dig was about topics Satya and more the as of all and guys in competitor for the connecting nice calls your I one and Team's you of this acquisition of and CRM Teams that's your mentioned across how that that understood talk they defense framework. Teams more some kind quarter number additional the was to pulled behind asking is workers story is guys go get two huge worker that how of products and Teams Could think of connection that you how Teams I of workers like was be base people area an because and I it they the one us to a in there help a between kind two. Microsoft acquisition kind to information as hear another story Microsoft frontline between for would understand about linkage of most that and for the against surprised a number frontline after. into think you from one broader question

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with the workers tools these more knowledge it's in and if collaborating digital versus workers being In anything frontline enabling fact, with workflow participate about to of work disconnected.

on for us. story. in a Thanks That's fascinating it experience digging Thanks. with

Keith. question, Thanks will we take the please. Operator next

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with with from the your Mark Please comes Murphy Our proceed question of Morgan. next question. line JP

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expense we've the seen the XX% in a be we and and we've to are coming a remotely working that's in frankly for maybe having forward is that logic in the why would see add of that's we growth step spots headcount ways I of and over think back across of ways close invest past significant expanded been in say to a going opportunities we the some the successful what of Mark year. and to the anniversary take where when talked I many Yes, customers have year question we many as about, world narrowness on the time at I overall from up

looking what in I invest employees, and and of we of which ways is continue to Satya types conversation I to look in is industry behind course segment customer so is XXX talks role deliver are about for places, success And us across time flexibility both and as the Microsoft provide we invest rethink lots in about. own every able to productivity work which a to think travel to continuing which those how are what will specifically finally is of and very of opportunity tools a we of driving where actually about should to we to our what means takes that in every how broad be exciting many that need the learning and and for a to think developing. flexible the broader there like be pretty But this it's force patterns talked obviously do it lots

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comes proceed of with Pritchard question. Walter your next with Our line Citibank. the question from Please

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your of the Please next from comes with Raimo with Barclays. question Lenschow line Our question. proceed

and experiences talk we you Xbox as strong you. bit emerging Game knew Pass early Gaming. you a well. to as ago little importance had we talk Ultimate congrats from that Thank so for all the and a I a the you of you Obviously that? about few Xbox some wanted of very the it see there the quarter saw can also a bit me about Thank launch little months but

Xcloud very the we very fundamentally Amy Yes. excited to it's it can about Maybe On start this. expansion I'll are provides. add you opportunity early but days

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Thanks question the we'll take Raimo. please. last Operator

Thank you.

from comes of the Please Brad with with question question. line Stifel. your final Our Reback proceed

cash or but as look settlement the growing we flow ahead flow you aware the everyone's the about audit was Amy, puts quarter far talked with much. income? Thanks. quarter very expectations any there know we just line cash are forward and much and [ex] Thanks of that in I strong the focus should billings Great. pretty we net be takes on should of in in

on the flow, been an things I in whether mentioned do benefited watch with in timing and like operating expenditures question us execution. general it our generally cloud it's it's the like free quarter you've improving capital tend really have in because of the strong the that feel things something it's we cash really accrual move basis you the on can settlement line or income quarter reflect move all to but those overall whether versus it on this margins of good should especially sales fundamentals and a business lines. It's Yes, focused to cash quarter, very for Brad

much. Great. Thanks very

Q&A speaking we soon. very Brad. of Thank Thanks all to up with today today's us look That you portion joining call. wraps earnings for the you and of forward

Thank you all and stay safe.

very much. you Thank

concludes you. teleconference. Thank today's This

Thank may for lines participation this your and You at have a you your day. disconnect time. wonderful