Microsoft Cloud Was A Ray Of Sunshine This Quarter With Revenue Up 128%
AP
Another way of saying that: Microsoft's cloud appears to have hit over $1 billion this quarter.
The company just released its first quarter results and reported that commercial cloud revenue from business customers (not consumers), grew by $662 million, or 128%.
Microsoft doesn't break out the actual cloud revenue. It lumps that into a category called "commercial other," which includes both cloud services and consulting services. (It's not alone. Amazon doesn't report its cloud revenue, either, but lumps it into an "other" category.).
In any case, the whole "commercial other" unit is growing: It generated over $2.4 billion last quarter, up from $1.6 billion in the year-ago quarter.
This includes Azure, Microsoft's Amazon competitor; Office 365, it's Google Apps competitor; and its Dynamics CRM Online, its Salesforce.com competitor.
Microsoft CEO Satya Nadella insists that the growing numbers show, "it's no longer for debate whether we get the cloud."
Now, $1 billion, or even $4.4 billion, is still peanuts compared to the money Microsoft generates from selling software to businesses the old-fashioned way, through licenses.
Commercial revenue from that was nearly $9.9 billion for the quarter, particularly helped by sales of Microsoft's database, SQL Server. And there's a trickle effect when companies buy something like a database. They also have to buy Windows licenses to run the database on PCs and servers.
And if there is a dark cloud, it's this: half of that cloud growth came at the expense of regular Microsoft Office licenses. Office Commercial revenue declined $322 million, or 7%.
Ultimately though, moving companies from regular software to the cloud is good news for Microsoft. Microsoft should make more money over time with cloud versions of Office. Businesses are willing to pay more because they automatically get security updates and the latest features. And they save money overall because they don't need to buy computer servers and other hardware.
The losers, for now in this switch to the cloud are the hardware makers like IBM and HP, who are working hard to nab customers for their own clouds.
- I got a $40K raise using this 30-second strategy. It made me realize loud work, not hard work, always wins.
- Qatar Airways' new CEO explains why it's sticking with the Airbus A380 as other airlines retire the costly superjumbo
- Prince Harry and Meghan found out about Kate Middleton's cancer diagnosis on TV like everyone else, report says
- Fresh photographs of Milky Way’s black hole Sgr A* reveal strong, twisted magnetic field similar to M87*
- 8 Lesser-known places to explore in Himachal Pradesh
- Markets end FY24 on buoyant note amid positive global cues
- SRM Contractors IPO allotment – How to check allotment, GMP, listing date and more
- Rupee falls 6 paise to settle at 83.39 against US dollar