Microsoft reports higher than expected revenue for Q3 2014

Microsoft has reported a decline in its profits as a result of costs related to job cuts and its purchase of Nokia’s smartphone business earlier this year.

However, the tech giant reported higher-than-expected quarterly revenue, helped by stronger sales of its phones, Surface tablets and cloud-computing products for companies, while keeping its profit margins largely intact.

Microsoft made $4.5 billion in Q3 2014, 13% lower than the same time last year.

“Integrations and restructuring expenses” cost $1.1 billion, Microsoft said.

However, the new Nokia business also boosted revenues. They climbed 25% to $23.2 billion, beating expectations and sending shares higher in after-hours trading.

In July Microsoft announced plans to cut 18,000 jobs, including 12,500 in the Nokia unit it bought in April.

On October 22 Microsoft said it would no longer use the Nokia name, selling future Lumia smartphone models as Microsoft-branded phones.

Microsoft CEO Satya Nadella said the company was being “positioned for future growth”.

“Our teams are delivering on our core focus of reinventing productivity and creating platforms that empower every individual and organization,” he said in a statement accompanying earnings.

Microsoft makes most of its money selling software to companies. The results show a strong growth in its business selling cloud computing to companies – an area Satya Nadella has cited as important for the future of Microsoft.

The business has continued to place great importance on its consumer products like the Xbox games console, its Surface range of tablet computers, and smartphones.

Stronger sales of phones and tablets helped boost revenues, with total consumer revenue up 47%.

Microsoft shares, which have climbed 33% over the past year, rose another 3% in after-hours trading to $46.36.