14 DAY TRIAL // Microsoft says that the decline of Windows phones is what dragged down the entire “More Personal Computing” unit in the last quarter, despite the fact that the Surface division also dropped because of the lack of new models.
The software giant doesn’t typically talk too much about phones, and the latest financial report made no exception, with the company only mentioning smartphones two or three times during the call with financial analysts.
Microsoft says phone revenue was “immaterial” and dropped no less than $361 million, without providing any specifics as to how many phones it sold. But as compared to the previous year, Windows phone are certainly on a decline, even though Microsoft has actually been rather quiet in the mobile business for at least a couple of years.
“Now to More Personal Computing. Revenue from this segment was $8.8 billion, down 2 percent and 1 percent in constant currency, with 4 points of decline from phone,” the company said.
Lower expenses with phones
On the other hand, the company actually managed to cut expenses with phones, mostly following the major cuts that impacted the mobile division across the world.
“Operating expenses declined 10 percent, and 9 percent in constant currency, from lower Phone expense as well as Surface and gaming marketing spend in the prior year. As a result, operating income grew 68 percent and 72 percent in constant currency,” the firm continued.
Things aren’t going to get better for Microsoft on the phone front, with the company expecting further decline in the next quarter as compared to the same period the year before. But this totally makes sense, especially because no new device or major Windows 10 Mobile makeover is expected in the meantime.
The good news is that Microsoft is believed to be looking into a new attempt at saving Windows phones, and the company is already testing a new device internally. When this device is supposed to arrive and, more importantly, how it plans to save the platform still remains to be seen.