Microsoft beat on revenue expectations, driven by strength in its cloud computing platform Azure. The company's intelligent cloud segment revenue, which include Azure, rose 27% to nearly $12 billion MSFT
Shares of the world’s largest software company hit an all-time high in after-hours trading. The results reflected the approach of Chief Executive Satya Nadella, who for five years has re-centered Microsoft around the cloud, renting out its computing power and technology to large businesses.
“We did have good usage, which matters a ton to that number,” Hood told Reuters. “The core thing that we focused on - which is consumption growth - was quite good.” “This quarter was an absolute ‘blow out quarter’ across the board with no blemishes and in our opinion speaks to an inflection point in deal flow as more enterprises pick Redmond for the cloud,” Wedbush analyst Dan Ives said in a note, referring to Microsoft’s headquarters location in Redmond, Washington.
Microsoft has focused on hybrid cloud computing – in which a business can use a mix of Microsoft’s data centers and its own – as well as on delivering its longstanding productivity programs such as Office via the cloud. “Azure’s renewed growth doesn’t yet pose a threat to AWS’s supremacy in the cloud market, but it does present an opportunity to further close the gap on Amazon and increase its lead over other cloud providers,” said Andrew MacMillen of Nucleus Research.
Its Productivity and Business Process unit, which contains the LinkedIn social network, reported $11.8 billion in revenue compared with estimates of $11.4 billion.
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