Microsoft recently unveiled its financial performance for the second quarter of the 2026 fiscal year, showcasing remarkable growth in revenue and net income. The tech giant achieved a revenue of $81.3 billion and a net income of $30.9 billion during Q3, marking a 17% and 23% increase respectively.
The surge in PC shipments during the holiday season, attributed to the ongoing RAM shortage and the end of Windows 10 support, has significantly impacted Microsoft’s Windows OEM and devices revenue. While Windows OEM revenue experienced a 5% boost due to upgrades during the Windows 10 end-of-life phase, the devices revenue witnessed a decline as Surface revenue and Windows OEM revenue were consolidated.
Furthermore, Windows 11 reached a significant milestone with 1 billion users, growing by 45% year-over-year. The transition from Windows 10 to Windows 11 has been expedited by the end of Windows 10 support, facilitating the rapid adoption of the new operating system.
Despite the absence of new Surface devices in the recent quarter, Microsoft’s Xbox hardware revenue continues to decline for the third consecutive fiscal year. The downward trend in Xbox hardware revenue, decreasing by 32% year-over-year, is expected to persist throughout fiscal 2026.
Source: The Verge