There was no impact to our consolidated financial statements. Many organizations that license our products and services transact directly with us through Enterprise Agreements and Enterprise Services contracts, with sales support from system integrators, independent software vendors, web agencies, and partners that advise organizations on licensing our products and services (Enterprise Agreement Software Advisors or ESA). The Productivity and Business Processes segment, containing Microsoft 365 (formerly known as Office 365), LinkedIn and Dynamics, delivered $17 billion in revenue, up 7% and more than the . Microsoft revenue for the twelve months ending December 31, 2022 was $204.094B, a 10.38% increase year-over-year. It has helped us become more empathetic toward our colleagues and enabled us to work together as a teamas One Microsoft. This year, we made progress in our work to address racial injustice and inequity. Under the Open agreements, organizations purchase perpetual licenses and SA is optional. Windows OEM Pro revenue decreased 9% and Windows OEM non-Pro revenue grew 21%. We believe potential can be nurtured and is not pre-determined, and we should always be learning and curious trying new things without fear of failure. Aggregate demand for our software, services, and devices is correlated to global macroeconomic and geopolitical factors, which remain dynamic. Learn more about how Statista can support your business. This report includes estimates, projections, statements relating to our business plans, objectives, and expected operating results that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. Other reconciling items, net consists primarily of tax credits and GILTI tax, and in fiscal year 2021, includes tax benefits from the India Supreme Court decision on withholding taxes. Additional information on our reportable segments is contained in Note 19 Segment Information and Geographic Data of the Notes to Financial Statements. The information found on these websites is not part of, or incorporated by reference into, this or any other report we file with, or furnish to, the SEC. Microsoft Corporation, Sandra E. Peterson 2,3 The investments we are making in infrastructure and devices will continue to increase our operating costs and may decrease our operating margins. The objectives of accounting for income taxes are to recognize the amount of taxes payable or refundable for the current year, and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an entitys financial statements or tax returns. As a result of the TCJA, we are required to pay a one-time transition tax on deferred foreign income not previously subject to U.S. income tax. The Microsoft Cloud is the most comprehensive and trusted cloud, providing the best integration across the technology stack while offering openness, improving time to value, reducing costs, and increasing agility. The following table presents the notional amounts of our outstanding derivative instruments measured in U.S. dollar equivalents: The following table presents our derivative instruments: Gross derivative assets and liabilities subject to legally enforceable master netting agreements for which we have elected to offset were $395 million and $335 million, respectively, as of June 30, 2021, and $399 million and $399 million, respectively, as of June 30, 2020. Microsoft generated $51.728 billion in revenue during Q2 2022, across the following three segments. Our vision is to create economic opportunity for every member of the global workforce through the ongoing development of the worlds first Economic Graph, a digital representation of the global economy. Application development is moving beyond professional developers and into the hands of citizen developerseveryone from domain experts, to designers, marketers, salespeople, customer service professionals, teachers, students, and others. Net gains on derivatives decreased due to lower gains on foreign currency contracts. Although we were not a party to the appeals, our software sales in India were determined to be not subject to withholding taxes. In its operation of the business, management, including our chief operating decision maker, who is also our Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis not consistent with GAAP. The credit risk and average maturity of our fixed-income portfolio are managed to achieve economic returns that correlate to certain fixed-income indices. These financial statements are the responsibility of the Companys management. We use a range of amounts to estimate SSP when we sell each of the products and services separately and need to determine whether there is a discount to be allocated based on the relative SSP of the various products and services. Celanese Corporation CE reported earnings from continuing operations of $7.03 per share in the fourth quarter of 2022, up 46% from . The metrics are disclosed in the MD&A or the Notes to Financial Statements. To foster their and our success, we seek to create an environment where people can do their best work a place where they can proudly be their authentic selves, guided by our values, and where they know their needs can be met. We adopted the standard effective July 1, 2020. Excluding this impact, gross margin percentage was relatively unchanged driven by gross margin percentage improvement in Azure, offset in part by sales mix shift to Azure. We read and evaluated managements documentation, including relevant accounting policies and information obtained by management from outside tax specialists, that detailed the basis of the uncertain tax positions. Visual Studio has more than 25 million monthly users, and GitHub is home to over 65 million developers who use it to build, ship, and maintain their software. IMPORTANT NOTICE TO USERS (summary only, click here for full text of notice); All information is unaudited unless otherwise noted or accompanied by an audit opinion and is subject to the more comprehensive information contained in our SEC reports and filings. We believe our server products provide customers with advantages in performance, total costs of ownership, and productivity by delivering superior applications, development tools, compatibility with a broad base of hardware and software applications, security, and manageability. Attachment of Windows to devices shipped. PSUs generally vest over a performance period of three years. This is not possible without trust. Depreciation expense declined in fiscal year 2021 due to the change in estimated useful lives of our server and network equipment. We are also at the forefront of the enterprise metaverse, a new infrastructure layer made possible through the convergence of the digital and physical worlds. Total. Through this commitment we can allow everyone the chance to be their authentic selves and do their best work every day. Given our focus on understanding core company beliefs and compliance topics, all employees complete required learning programs like Standards of Business Conduct, Privacy, Unconscious Bias, and preventing harassment courses. Windows, including Windows OEM licensing and other non-volume licensing of the Windows operating system; Windows Commercial, comprising volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings; patent licensing; Windows Internet of Things; and MSN advertising. Recent Accounting Guidance Not Yet Adopted. Of the total employed people, 67,000 were in operations, including manufacturing, distribution, product support, and consulting services; 60,000 were in product research and development; 40,000 were in sales and marketing; and 14,000 were in general and administration. Land is not depreciated. During fiscal year 2021, our Daily Pulse surveys gave us invaluable insights into ways we could support employees through the COVID-19 pandemic and addressing racial injustice. Refer to Risk Factors in our fiscal year 2021 Form 10-K for a discussion of these factors and other risks. Investments with maturities beyond one year may be classified as short-term based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. Price Quote as of 2/17/2023 4:00:00 PM - ET. Virtual Shareholder Meeting: www.virtualshareholdermeeting.com/MSFT21. Billionaires like Microsoft Corp. co-founder Bill Gates likely saw an opportunity through . Operating income increased $17.0 billion or 32% driven by growth across each of our segments and the change in estimated useful lives of our server and network equipment. In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine the SSP using information that may include market conditions and other observable inputs. Refer to Note 16 Stockholders Equity of the Notes to Financial Statements for further discussion. For a discussion of the year ended June 30, 2020 compared to the year ended June 30, 2019, please refer to, Managements Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended June 30, 2020. In addition to our main research and development operations, we also operate Microsoft Research. The second broad category of OEMs are system builders consisting of lower-volume PC manufacturers, which source Microsoft software for pre-installation and local redistribution primarily through the Microsoft distributor channel rather than through a direct agreement or relationship with Microsoft. In addition to poll and pulse surveys, we gain insights through onboarding and exit surveys, internal Yammer channels, employee Q&A sessions, and AskHR Service support. No results; Cancel. We offer organizations the ability to ensure their data is being used only for their benefit. DIRECTORS AND EXECUTIVE OFFICERS OF MICROSOFT CORPORATION, Satya Nadella We have several partnerships with other companies, including Verizon Media Group, through which we provide and monetize search queries. In March 2020, the World Health Organization declared the outbreak of COVID-19 to be a pandemic. Quarterly smartphone market share worldwide by vendor 2009-2022, Apple iPhone unit sales worldwide 2007-2018, by quarter, Global market share held by smartphone operating systems 2009-2018, by quarter, Virtual reality (VR) - statistics & facts, Research expert covering the consumer electronics industry, Profit from additional features with an Employee Account. 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. Net recognized gains (losses) on debt investments were as follows: Net recognized gains (losses) on equity investments were as follows: The components of investments were as follows: Equity investments presented as Other in the tables above include investments without readily determinable fair values measured using the equity method or measured at cost with adjustments for observable changes in price or impairments, and investments measured at fair value using net asset value as a practical expedient which are not categorized in the fair value hierarchy. Fair value is calculated based on publicly available market information or other estimates determined by management. We also know that solving the carbon problem will require new technology and partnerships. Physical and virtual worlds are coming together with the Internet of Things (IoT) and mixed reality to create richer experiences that understand the context surrounding people, the things they use, the places they go, and their activities and relationships. The proceeds of these issuances were or will be used for general corporate purposes, which may include, among other things, funding for working capital, capital expenditures, repurchases of capital stock, acquisitions, and repayment of existing debt. Microsoft Product and Services Agreements are designed for medium and large organizations that want to license cloud services and on-premises software as needed, with no organization-wide commitment, under a single, non-expiring agreement. As of June 30, 2021, we had federal, state, and foreign net operating loss carryforwards of $304 million, $1.3 billion, and $2.0 billion, respectively. Certain cloud services, primarily Office 365, depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation. Get full access to all features within our Business Solutions. Business, and Chief Marketing Officer, Christopher D. Young Our consumer businesses also benefited from the remote environment, with continued demand for PCs and productivity tools, as well as strong engagement across our Gaming platform. Zoom offers videoconferencing and cloud phone solutions. In a separate 2009 decision, the Court of Appeals for the District of Columbia held that adverse health effect claims arising from the use of cellular handsets that operate within the U.S. Federal Communications Commission radio frequency emission guidelines (FCC Guidelines) are pre-empted by federal law. LinkedIn has over 750 million members and has offices around the globe. We are living in the new era of the intelligent cloud and intelligent edge, which is being sharpened by rapid advances in distributed computing, ambient intelligence, and multidevice experiences. We use a single amount to estimate SSP for items that are not sold separately, including on-premises licenses sold with SA or software updates provided at no additional charge. Financial metrics are calculated based on GAAP results and growth comparisons relate to the corresponding period of last fiscal year. Computershare, our transfer agent, can help you with a variety of shareholder related services including: Computershare also administers a direct stock purchase plan and a dividend reinvestment program for the company. Property and equipment is stated at cost less accumulated depreciation, and depreciated using the straight-line method over the shorter of the estimated useful life of the asset or the lease term. Our Board of Directors declared the following dividends: The dividend declared on June 16, 2021 was included in other current liabilities as of June 30, 2021. Our search business competes with Google and a wide array of websites, social platforms like Facebook, and portals that provide content and online offerings to end users. Our Office of Responsible AI ensures that we put these principles into practice, and our Responsible AI Resources Center shares guidelines and tools to help our customers and the developer community do the same. Use Ask Statista Research Service, On April 25, 2014, Microsoft completed the transaction to acquire substantially all of Nokia Corporations Devices and Services Business (NDS). And yet, as I reflect on what has been a very challenging year for so manyone that will be forever remembered as a heartbreaking chapter in our historyI find reasons to be hopeful. Revenue related to cloud services provided on a subscription basis is recognized ratably over the contract period. services revenue growth, Revenue from Windows Commercial products and cloud services, comprising volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings, Revenue from Surface devices and accessories, Revenue from Xbox content and services, comprising digital transactions, Xbox Game Pass and other subscriptions, video games, third-party video game royalties, cloud services, and advertising, Search advertising revenue, excluding TAC, growth, Revenue from search advertising excluding traffic acquisition costs (TAC) paid to Bing Ads network publishers. Our goal is to help every organization strengthen its security capabilities through a Zero Trust architecture built on our comprehensive solutions that span identity, security, compliance, and device management across all clouds and platforms. Adjusted EBITDA is projected between $380 million and $415 million, down from $453.5 million reported last year. The Automotive Voice Command System market size, estimations, and forecasts are provided in terms of and revenue (USD millions), considering 2023 as the base year, with history and forecast data . LinkedIn, including Talent Solutions, Marketing Solutions, Premium Subscriptions, Sales Solutions, and Learning Solutions. We purchased the removal of 1.3 million metric tons of carbon from 26 projects around the world. All of our approximately 23,000 people managers must complete between 25-30 hours of required manager capability and excellence training and are assigned ongoing required training each year. We have operating and finance leases for datacenters, corporate offices, research and development facilities, Microsoft Experience Centers, and certain equipment. To achieve our vision, our research and development efforts focus on three interconnected ambitions: Reinvent Productivity and Business Processes. Windows Commercial products and cloud services revenue increased 14%. In addition, all employees complete skills training based on the profession they are in each year. Price as of February 28, 2023, 12:39 p.m. Microsoft's revenue from 2012 to 2022 financial years, by segment (in billion U.S. dollars) [Graph]. Contact Computershare directly to find out more about these services and programs at 800-285-7772, option 1, or visit online at: https://www.computershare.com/Microsoft, You can e-mail the transfer agent at: web.queries@computershare.com. The goodwill was primarily attributed to increased synergies that are expected to be achieved from the integration of ZeniMax. 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