Microsoft released its much anticipated quarterly numbers on Monday and the report shows that Microsoft’s cloud based products are experiencing triple digit growth. On the Investors Relations page of Microsoft.com, close inspection of the documents show that commercial cloud related revenues grew at a rate of 114% over the last quarter. As CEO Satya Nadella approaches his one year anniversary of being on the job, it seems as if he delivering on his intent to transform Microsoft into a mobile-first, cloud-first company.
CFO Amy Hood commented on the rapid growth saying, “Our commercial cloud services delivered triple-digit revenue growth for the sixth consecutive quarter.” Hood adds, “Office 365 continues to be priority for CIOs, as both existing and new customers move to the cloud. This transition accelerated with 45 percent of our renewal seats in Office moving to the cloud this quarter.”
Microsoft Office 365 was revealed to have over 9.2 million users, a boost of about 30% from last year. New services and features being added inside of Azure have helped attract a wider audience of users. Dynamic CRM has also seen a rise in revenue. Overall, Microsoft cloud services resulted in $13.3B in commercial revenue. The addition of cloud features and functionality are the main driver in many organizations switching from desktop software to cloud based software. Microsoft also indicated that its desktop version of Office took a hit on the balance sheets. Microsoft believes the slump in traditional Office license sales is directly attributed to organizations retiring Windows XP and moving to Office 365.
Microsoft notes that the Xbox One holds the distinction of being the top selling gaming console through out the 2014 holiday season. Experts believe that new Xbox gaming content as well as a price reduction on the console’s MSRP helped contribute the consoles resurgence. Financial analyst Daniel Ives commented on Microsoft earnings report saying, “Xbox gives them some of a tailwind in the quarter, Azure continues to be strong and the move to Office 365 is still a catalyst.”