Representation is only one measure of progress, and we must keep pushing to do more, but Iâm encouraged by our progress. The plaintiffs allege that their handsets either operated outside the FCC Guidelines or were manufactured before the FCC Guidelines went into effect. The estimates used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions, and other factors. The fair value of stock awards vested was $8.7 billion, $6.6 billion, and $4.8 billion, for fiscal years 2019, 2018, and 2017, respectively. Certain options and forwards not designated as hedging instruments are also used to manage the variability in foreign exchange rates on certain balance sheet amounts and to manage other foreign currency exposures. Azure revenue is mainly affected by infrastructure-as-a-service and platform-as-a-service consumption-based services, and per user-based services such as Enterprise Mobility + Security. Growth depends on our ability to reach new users, add value to our core product set, and continue to expand our product and service offerings into new markets. Adjustments to reconcile net income to net cash from operations: Net recognized gains on investments and derivatives. Nearly all computer manufacturers offer server hardware for the Linux operating system and many contribute to Linux operating system development. Many organizations that license our products and services transact directly with us through Enterprise Agreements and Enterprise Services contracts, with sales support from system integrators, independent software vendors, web agencies, and partners that advise organizations on licensing our products and services (âEnterprise Agreement Software Advisorsâ or âESAâ). Our effective tax rate was higher than the U.S. federal statutory rate primarily due to the net charge related to the enactment of the TCJA, offset in part by earnings taxed at lower rates in foreign jurisdictions resulting from our foreign regional operations centers in Ireland, Singapore, and Puerto Rico. Our search business competes with Google and a wide array of websites, social platforms like Facebook, and portals that provide content and online offerings to end users. Office Commercial revenue increased 13%, driven by Office 365 Commercial growth of 33%. Search advertising revenue, excluding traffic acquisition costs, increased 16%, driven by growth in Bing, due to higher revenue per search and search volume. We repurchased the following shares of common stock under the share repurchase programs: Shares repurchased in the first and second quarter of fiscal year 2017 were under the 2013 Share Repurchase Program. Cash used in financing increased $3.3 billion to $36.9 billion for fiscal year 2019, mainly due to an $8.8 billion increase in common stock repurchases and a $1.1 billion increase in dividends paid, offset in part by a $6.2 billion decrease in repayments of debt, net of proceeds from issuance of debt. We estimate that we have no significant residual value related to our intangible assets. The first installment of the transition tax was paid in fiscal year 2019, and the remaining transition tax of $16.4 billion is payable over the next seven years with a final payment in fiscal year 2026. In a separate 2009 decision, the Court of Appeals for the District of Columbia held that adverse health effect claims arising from the use of cellular handsets that operate within the U.S. Federal Communications Commission radio frequency emission guidelines (âFCC Guidelinesâ) are pre-empted by federal law. Research and development expenses increased $1.7 billion or 13%, primarily due to investments in cloud engineering and LinkedIn expenses. Interest expense increased primarily due to higher average outstanding long-term debt and higher finance lease expense. Our Board of Directors declared the following dividends: The dividend declared on June 12, 2019 was included in other current liabilities as of June 30, 2019. Given the complexity and the subjective nature of the transfer pricing issues that remain unresolved with the IRS, evaluating managementâs estimates relating to their determination of uncertain tax positions required extensive audit effort and a high degree of auditor judgment, including involvement of our tax specialists. We have operating and finance leases for datacenters, corporate offices, research and development facilities, retail stores, and certain equipment. We conducted our audit in accordance with the standards of the PCAOB. Our increasing engagement with open source software will also cause us to license our intellectual property rights broadly in certain situations. Our web application platform software competes with open source software such as Apache, Linux, MySQL, and PHP. Revenue from consulting services is recognized as services are provided. Xbox Live is designed to benefit users by providing access to a network of certified applications and services and to benefit our developer and partner ecosystems by providing access to a large customer base. Analysts had expected Microsoft to earn $32.8 billion in revenue and report earnings per share of $1.08. Global Sales, Marketing and Operations, Bradford L. Smith Research and development expenses also include third-party development and programming costs, localization costs incurred to translate software for international markets, and the amortization of purchased software code and services content. We are on a journey to close the gap between our espoused culture and the lived experience for every employee at Microsoft. Productivity and Business Processes revenue increased, driven by LinkedIn and higher revenue from Office. Talent Solutions is comprised of two elements: Hiring, and Learning and Development. Windows IoT extends the power of Windows and the cloud to intelligent systems by delivering specialized operating systems, tools, and services for use in embedded devices.