Nadella’s stint as Microsoft CEO starts off on the right foot with strong Q3 earnings

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Microsoft plans to take the fight directly to Apple in NYC with a massive new retail outlet

This has quarter has been very busy and eventful for Microsoft. Not only did the company announce the appointment of new CEO Satya Nadella but it also launched its popular Office suite for the iPad for the first time, came out with a major update to Windows 8.1 that made it more friendly to desktop users, and it decided to make Windows Phone free to use for hardware developers in an effort to better compete with Google’s own free-to-use Android platform.

How did all these big events impact Microsoft’s bottom line? The company on Thursday reported a profit of $0.68 per share on revenues of $20.4 billion, which beat the consensus estimate of $0.63 per share on revenues of $20.38 billion. One of the stars for Microsoft this past quarter was Microsoft Office 365 Home, which added roughly 1 million new subscribers on the quarter and now has 4.4 million subscribers in all. Microsoft also said it sold 1.2 million Xbox One consoles on the quarter. Microsoft posted Surface sales of $500 million on the quarter, which represented a 50% increase from the Surface sales it posted in Q3 2013.

However, while Microsoft’s earnings beat the consensus estimate, they still represented a decline from its Q3 2013 earnings report, when it posted earnings of $0.72 per share on revenues of $$20.49 billion.

Investors generally reacted positively to the earnings report, with Microsoft shares growing by around 2% in after-hours trading following the announcement.

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