Shares of the Redmond company are over 4 percent higher in premarket on Friday.
Microsoft reported revenue of $23 billion and .54 cents a share, beating consensus estimates of $22.013 billion in revenue and .49 cents a share according to the estimate from Facstset.
“We are off to a great start to the year” said Microsoft CEO Satya Nadella during the conference call.
Devices and consumer revenue grew 47 percent to $10.96 billion with Office 365 Home and Personal subscribers totaling more than 7 million, representing 25 percent growth over the quarter.
Surface Pro 3 pushed Surface revenue higher to $ 908 million.
Xbox console sales jumped to $ 2.4 million, an increase of 102 percent which comes as Xbox One launches in 28 new markets.
Phone hardware revenue exceeded $ 2.6 billion.
Commercial revenue grew 10 percent to $12.28 billion, led by 128 percent growth in commercial cloud revenue driven by Office 365, Azure, and Dynamics CRM
“Customers are embracing our latest technologies from Surface Pro 3 and Office 365 to Azure and SQL server,” said Kevin Turner, Chief Operating Officer at Microsoft.
For the quarter, Microsoft took a $ 1.14 billion or .11 cent a share hit from integration and restructuring expenses due to its Nokia Devices and Service business.