Close
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Cloud
    • Cloud

    Microsoft’s Cloud Boosts First-Quarter Earnings

    Written by

    Pedro Hernandez
    Published October 23, 2015
    Share
    Facebook
    Twitter
    Linkedin

      eWEEK content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.

      Microsoft announced today that it posted revenue of $21.66 billion during the company’s fiscal year 2016 first quarter ending Sept. 30, a 7 percent year-over-year decline. Net income was $5.38 billion, or 67 cents per share, beating Wall Street estimates of 59 cents per share, a 3 percent improvement.

      In what is now a familiar theme, increased demand for Microsoft’s enterprise cloud services is helping the company improve its financial fortunes.

      “We’re seeing great traction with businesses who want to bring Microsoft’s cloud, mobile device management technology and data analytics together to improve security and productivity resulting in almost 70 percent year-over-year growth in our commercial cloud run rate,” said Microsoft COO Kevin Turner in an Oct. 22 statement. According to the company’s figures, Microsoft’s annual commercial cloud run rate now exceeds $8.2 billion.

      Server and cloud services sales grew 13 percent year over year, using Microsoft’s constant-currency calculations that account for foreign currency fluctuations. Revenue from the company’s enterprise support services grew by 16 percent. Azure compute demand and revenue more than doubled. All told, the segments contributed $5.89 billion to Microsoft’s revenue last quarter.

      Forrester analyst Frank Gillett told eWEEK that while Microsoft’s “cloud strategy is clearly producing benefits for them,” the company’s momentum has yet to pull Microsoft ahead of the pack. Nonetheless, the company’s progress is commendable given its “fundamental shift from products to [cloud] services.”

      The cloud-enabled Office 365 commercial product portfolio saw a 70 percent increase in sales and a 66 percent increase in seats last quarter. Sales of Microsoft’s Dynamics customer relationship management (CRM) and enterprise resource planning (ERP) software and cloud services suite grew by 12 percent.

      Windows OEM sales dropped 6 percent, or “what you expect when you give Windows away for free,” Gillett said, referencing the free Windows 10 upgrade promotion. Windows volume licensing to enterprises grew by 4 percent.

      To date, 110 million “active devices” are running Windows 10, the latest version of the company’s flagship operating system, said Microsoft CEO Satya Nadella during an investor conference call today. Eight million business PCs are running the new OS, he added.

      Windows Phone revenue dropped a precipitous 54 percent, highlighting the company’s struggles in the smartphone market. Although Microsoft’s single-digit share of the smartphone market remains persistently low, there’s little chance of the company ceding the market completely to Apple iOS and Google’s Android mobile operating system, said Gillett. “Strategically, they can’t give up on mobile.”

      Microsoft’s Devices and Consumer unit generated $9 billion in revenue in the first quarter, a 17 percent decline compared with the same year-ago period.

      Despite this, Nadella sounded an optimistic note in prepared remarks. “Customer excitement for new devices, Windows 10, Office 365 and Azure is increasing as we bring together the best Microsoft experiences to empower people to achieve more,” he said echoing the company’s mission.

      Pedro Hernandez
      Pedro Hernandez
      Pedro Hernandez is a writer for eWEEK and the IT Business Edge Network, the network for technology professionals. Previously, he served as a managing editor for the Internet.com network of IT-related websites and as the Green IT curator for GigaOM Pro.

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      MOST POPULAR ARTICLES

      Artificial Intelligence

      9 Best AI 3D Generators You Need...

      Sam Rinko - June 25, 2024 0
      AI 3D Generators are powerful tools for many different industries. Discover the best AI 3D Generators, and learn which is best for your specific use case.
      Read more
      Cloud

      RingCentral Expands Its Collaboration Platform

      Zeus Kerravala - November 22, 2023 0
      RingCentral adds AI-enabled contact center and hybrid event products to its suite of collaboration services.
      Read more
      Artificial Intelligence

      8 Best AI Data Analytics Software &...

      Aminu Abdullahi - January 18, 2024 0
      Learn the top AI data analytics software to use. Compare AI data analytics solutions & features to make the best choice for your business.
      Read more
      Latest News

      Zeus Kerravala on Networking: Multicloud, 5G, and...

      James Maguire - December 16, 2022 0
      I spoke with Zeus Kerravala, industry analyst at ZK Research, about the rapid changes in enterprise networking, as tech advances and digital transformation prompt...
      Read more
      Video

      Datadog President Amit Agarwal on Trends in...

      James Maguire - November 11, 2022 0
      I spoke with Amit Agarwal, President of Datadog, about infrastructure observability, from current trends to key challenges to the future of this rapidly growing...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2024 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×