Microsoft’s Surface devices hit another rocky patch as sales remain stagnant

Microsoft has revealed its latest financial results, and the firm may well be concerned about the lackluster Surface sales which were reported therein.

While the overall balance sheet for the second quarter of the 2018 financial year looked good, with headline revenue of $28.9 billion (around £20 billion, AU$36 billion) – an impressive increase of 12% year-on-year – sales of Surface devices only totalled $1.3 billion (around £910 million, AU$1.6 billion), the Inquirer has spotted.

We say ‘only’ because compared to the sizeable gains made elsewhere, revenue for Surface hardware increased by just 1%, effectively remaining stagnant.

Which isn’t great considering that Microsoft launched the long-awaited Surface Book 2 last November, as well as the all-new Surface Laptop back in the summer, alongside a refreshed Surface Pro.

So despite this trio of fresh products being ready for holiday sales over the quarter just gone, the money being raked in pretty much flatlined. And that has to be disappointing for Microsoft, obviously.

Book ‘em, Danno

That said, the more expensive machines like the Surface Book 2 did reportedly see solid enough sales, but that’s a fairly niche proposition compared to the Surface Pro, as we’ve seen in the past.

The Surface line has been pretty up and down of late, seeing some big drops in revenue last year, including a 26% plunge at one point – although the previous quarter to this one (Q1) saw impressive 12% gains. At the time, Microsoft said the latter had been driven by folks purchasing the new Surface Laptop, so we could theorize that interest has waned after an initial surge of sales for that machine.

Previously rocky Surface numbers have even given rise to speculation that Microsoft might kill off its Surface range for good, a rumor the firm was very quick to scotch.

As for the rest of the overall fiscal picture, revenue in the firm’s intelligent cloud division hit an impressive $7.8 billion (around £5.5 billion, AU$9.8 billion) which was up 15%, and productivity and business raked in $9 billion (around £6.3 billion, AU$11.3 billion) which represented a hefty increase of 25% year-on-year.

The latter included Office consumer products and cloud services going up by 12%, with the number of Office 365 consumer subscribers reaching 29.2 million. Not too shabby indeed.

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