During the quarterly financial report, Microsoft revealed that Office 365 consumer subscriptions which includes Home and Personal editions increased to 5.6 million in total. In fact, Microsoft added 1 million subscribers in the last quarter. Microsoft COO Kevin Turner said they are thrilled with the tremendous momentum of our cloud offerings with Office 365.
CFO Amy Hood commented the following on Office 365,
Our commercial cloud revenue grew 147% this quarter, driven by both Office 365 and Azure. Our commercial cloud annual revenue run rate more than doubled this year, and now exceeds $4.4 billion.And, with this rapidly growing scale, we continue to expand our cloud gross margins. We saw strong commercial seat growth across Office 365, particularly with SMB customers. Additionally, we added over 1 million new subscribers to Office 365 Home and Personal, and we ended the quarter with 5.6 million users.
I also found one interesting Q&A happened during the call,
HILLIP WINSLOW, Credit Suisse: Hi, guys. Congrats on a great quarter.
I just want to dig into Office 365. You put up another quarter of pretty impressive metrics, going up to 5.6 million Home Premium users. I think the commercial side grew I think it was 98 percent year-over-year. And, Satya, you talked about some pretty meaningful download numbers as far as on the iPad.
I wonder if you could just give us an update on Office 365, how it’s doing versus your expectations, and sort of what your expectations are over the course of the next 12, 18, 24 months as we continue this transition?
AMY HOOD: Thanks, Phil.
In terms of versus our expectations, in this quarter it did do better than we expected and, frankly, we had quite loft goals. So, I think that is encouraging. I think I talked about some of those key drivers in the prior question. When I think really about Home and Personal, because we haven’t had a chance to talk specifically about the consumer usage, and you sort of referenced Office on the iPad in your question, I think it’s really about continuing to make the subscription value, whether it’s through the Home SKU or the Personal SKU, have the most value to a user. It’s about a user having the opportunity to access Office, the world’s leading productivity app, on the device of their choice, having it light up the very best on Windows devices, and having that accrue back to our subscriptions.
So, I think our ability to execute on that over the past I guess 18 months that we’ve had these SKUs in market is quite encouraging. I don’t really look to Office on the iPad as one item, it’s a part of the value proposition that I think we make both in the Consumer segment as well as in the Commercial segment.