Published: Fri, February 02, 2018
Science | By

Microsoft Azure revenue up 98% as it closes gap with AWS

Microsoft Azure revenue up 98% as it closes gap with AWS

This includes a 98% growth (98% CC) in Azure revenue, with Azure premium services growing by triple digits for the 14th quarter in a row.

Since Chief Executive Satya Nadella took the helm in 2014, Microsoft's cloud business - which includes products such as Office 365, Dynamic 365 and Azure - has emerged as a major growth area.

This equated to an operating income of $8.7bn, up 10% from the previous quarter, driven by increases across Microsoft's portfolio. Analysts expected earnings of 86 cents a share on sales of $28.35 billion, according to Zacks Investment Research.

Facebook said that it had 2.13 billion monthly active users and 1.4 billion daily users.

Microsoft's second quarter 2017 revenue grew 12% to $28.9 billion, beating Wall Street's expectations of $28.4 billion, thanks to accelerated growth in Microsoft cloud computing business.

After accounting for a repatriation payment under the Tax Cuts and Jobs Act, through which American companies can pay tax on foreign-earned money at a lower rate than usual, net loss was $6.3 billion.

Dynamics also saw strong growth, with products and cloud services up 10% (9% CC), and Dynamics 365 up 67% (68% CC).

Bernstein's Moerdler expects Azure's expansion to continue for the next few years and provide a significant source of revenue and earnings growth for Microsoft. The company's stock was up 2.45 percent in regular trading, but down about 1 percent in after-hours trading.

Microsoft's Q2 star was unquestionably the Intelligent Cloud division, which brought in revenue of $7.8 billion. There is also a decrease of 4% in Windows commercial products and cloud services revenue due to the impact of a prior year large deal. Overall, Microsoft (MSFT) reported better-than-expected earnings ( for its fiscal second quarter, even as the company reported a net loss because of a whopping $13.8 billion charge associated with changes in the US tax code.

In recent weeks, analysts have been positively gushing about Nadella and about Microsoft Chief Financial Officer Amy Hood.

The company's December-quarter results demonstrate "Microsoft's leading position across collaboration, public and hybrid cloud services and the emerging set of higher tier services in data analytics, IoT (Internet of Things) and artificial intelligence", he said.

Like this: