Software giant Microsoft (NASDAQ:MSFT) has continued to impress investors in 2018 amid its ongoing progress becoming a more cloud-centric company. The company recently wrapped up its fiscal 2018 with a 14% year-over-year increase in revenue and an impressive 21% boost to operating income. Shares have surged 28% year to date.

In less than two weeks, investors will get to see whether the company has been able to keep up its strong momentum into fiscal 2019. Microsoft reports its first-quarter earnings for fiscal 2019 on October 24. Ahead of Microsoft's earnings release, here's an overview of some of the key areas investors will want to watch.

Microsoft executive discusses the power of Microsoft Azure

Image source: Microsoft.

Commercial-cloud revenue

Core to Microsoft's momentum recently is the company's rapidly growing commercial-cloud revenue. As a revenue category that lumps together some of Microsoft's biggest commercial-cloud products -- including Office 365 commercial, Azure, and Dynamics 365 -- Microsoft's commercial-cloud revenue has been a major catalyst for the company.

In Microsoft's most recent quarter, commercial-cloud revenue increased 53% year over year, to $6.9 billion, accounting for 23% of the quarter's total revenue. 

For Microsoft's first quarter of fiscal 2019, investors should look for more year-over-year growth for the segment of around 50%. Microsoft CFO Amy Hood indicated in the company's fiscal fourth-quarter earnings call that the segment continues to fire on all cylinders, saying: "Customer commitment to our cloud platform continues to increase. In FY18, we closed a record number of multi-million dollar commercial cloud agreements and more than doubled the number of $10 million-plus Azure agreements."


Cloud-computing service Azure, which falls under Microsoft's commercial-cloud revenue categorization, also will be worth taking a close look at. Not only is Azure Microsoft's biggest contributor to the company's commercial-cloud revenue, but it's growing at a mind-boggling rate. In Microsoft's fiscal fourth quarter, Azure revenue surged 89% year over year, or 85% year over year in constant currency.

Given that this was a slight deceleration compared to the 93% revenue growth (89% growth in constant currency) that Azure saw in the third quarter of fiscal 2018, investors shouldn't be surprised to see some more modest deceleration in fiscal Q1. Of course, investors should look for Azure to grow at a high year-over-year growth rate of around 80%.


Investors also should look for an update on LinkedIn, which Microsoft acquired in 2016. The social network for professionals has been an excellent performer for the software giant. Fiscal fourth-quarter revenue from LinkedIn was up 37% year over year. Even more impressive, this was the segment's fifth quarter in a row of accelerating revenue growth.

Can LinkedIn's year-over-year revenue growth rate accelerate again in fiscal Q1?

Investors will get to see Microsoft's first-quarter results after market close on Wednesday, Oct. 24.

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