Microsoft reports $70.1bn in Q3 revenue as demand for AI tools increase
Stay Informed
Get Industry News In Your Inbox…
Sign Up Today
Microsoft’s revenue reached $70.1 billion in Q3 FY2025, a 13% year-over-year increase.
The company’s latest financials showed that operating income rose 16% to $32bn, while net income climbed 18% to $25.8bn.
Moreover, diluted earnings per share also grew by 18% to $3.46, reflecting the company’s growth momentum across its business segments.
On the gaming front, revenue grew 5% year-over-year, with Xbox content and services revenue up 8%, while PC Game Pass revenue grew over 45% year-over-year.
Gross margin dollars in the segment rose 9% as margin percentage improved by 2 points year-over-year, supported by efficiency in Gaming and Search.
Furthermore, operating income surged 21%, reflecting a focus on higher-margin opportunities despite a modest 1% increase in operating expenses. PC Game Pass revenue also grew over 45% year-over-year.
New advances
Microsoft said it is also integrating AI across Xbox and introduced Copilot for Gaming as a personalised in-game assistant and the Muse model for real-time gameplay generation.
Moreover, the Minecraft Movie has become the top-grossing film of the year, and its success has driven a more than 75% year-over-year increase in the game’s weekly active users.
“We continue to transform the business and focus on margin expansion, as we bring our games to over 500 million monthly active users across devices,” said Microsoft CEO Satya Nadella.
“We ended the quarter as the top publisher by pre-orders and pre-installs on both Xbox and the PlayStation Store.”
