The Cloud Gives Microsoft Huge Profits
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Microsoft released its third quarter (Q3) earnings earlier today for fiscal year 2014 (FY14). This is the first quarter under new CEO Satya Nadella. The earnings report contained a number of interesting pieces of the enterprise side of Microsoft is doing.
Windows Azure grew over 150% in the third quarter. Windows volume licensing was up 11% with business customers. Lync, SharePoint, and Exchange, our productivity server offerings, collectively grew double-digits and office commercial revenue was up 6%. Server product revenue up 10%. Total commercial licensing revenue grew 3% to 10.32 billion. SQL server revenue grew 15%.
Other commercial revenue was up 31% to $1.90 billion. Commercial cloud revenue grew 101% with Office 365 growing 100% and Windows Azure revenue growing 150%. Gross margins were up 6% to 80% gross margins!
All this contributed to commercial revenue of $12.23 billion, up 7%. Compare this to Devices and Consumer with revenue of $8.30 billion (up 12%). The enterprise and cloud business remains highly profitable for Microsoft.
Source: Microsoft
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