That growth, combined with increase in revenue from Windows software licenses and other key segments, helped offset a big decline in revenue from the Nokia smartphone business that Microsoft largely shut down past year. Business-related Office revenue rose 5%, after being flat in the third quarter.
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Microsoft’s Chief Financial Officer, Amy Hood, said the company spent the past year investing in innovation, and expanding its market presence in both product areas and geographically. But Microsoft’s “Intelligent Cloud” division – which includes Azure and some software that customers use in their own data centers – reported revenue of $6.7 billion, up 7 per cent from a year earlier.
SAP said that revenues in its cloud business increased by 30 percent to 720 million euros. Office 365 commercial seats rose 45% annually, and the Office 365 consumer base rose by 900,000 sequentially to 23.1 million, after having risen by 1.6 million in the prior quarter. Surface and Windows also saw a particular amount of momentum with Windows OEM non-Pro’s revenue growing 27%.
Overall FY16 paints a nice picture for Microsoft in the coming future.
Like in previous quarters, analysts will be especially interested in Microsoft’s cloud revenue.
It reported net income of $3.1 billion, or 39 cents per share, compared with a loss of $3.2 billion, or 40 cents per share, a year earlier. That beat Wall Street’s average forecast of $22.1 billion.
Microsoft closed out its fiscal year with a 38 percent rise in profit to US$16.8 billion.
Nadella also mentioned that Microsoft Cloud is doing significantly well.
Microsoft shares climbed more than 3 percent in after-market trading on the Nasdaq, to around $54.78, following its earnings announcement.
Azure is a cornerstone of Microsoft’s transformation from a primarily software company to a cloud services provider, and its performance so far clearly is making CEO Satya Nadella happy. It said operating profit in its intelligent cloud businesses fell 17 per cent to $2.19 billion in the quarter.
Do our readers think after 2 years in leadership Satya Nadella has proven his strategy is a success for Microsoft? (LNKD.N) for $26.2 billion.
Microsoft may continue to prove itself as the dominant organization for enterprise cloud customers, but there will be several challenges outside the cloud space, particularly with Windows 10 and its mobile business.
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While rumours frequently surface regarding Microsoft’s plans for a Windows 10-based Surface Phone comeback, the company’s smartphone operating system has largely been a failure.
