Cloud has once again been a big earner for Microsoft, with the company posting Azure revenue growth of 76% over the last quarter. Server products and cloud services have grown by 28%, while its “intelligent cloud” division has increased revenues by a quarter compared to the second quarter of 2018.
However, the growth of Microsoft’s Azure-related products has slowed since the previous quarter, which stood at a hefty 89%. It’s not too much of a concern for analysts as it would seem because many are still predicting the company’s cloud-focused business will continue to be the most important part of Microsoft’s success.
Microsoft doesn’t detail individual revenue streams in its Azure division, making it hard to judge where the majority of growth is (ie., platform, server, services), but the company’s CFO Amy Hood said on its earnings call that the demand for hybrid services was one worth watching and Microsoft would continue to grasp the opportunity presented by businesses looking for hybrid set-ups in their digital transformation efforts.
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“We are seeing larger and longer-term customer commitments to the cloud,” she told analysts on the call.
But it’s not just Azure performing well in the cloud space. The company’s cloud, server and Office departments combined generated $18.4 billion in revenue last quarter. Office 365 revenues, specifically in the commercial products and services sector rose by 17% and Office 365 commercial revenues grew 36% quarter-on-quarter. The company also added that active customers using its Office 365 services has grown significantly – topping 155 million at present.
The company’s total first-quarter revenue was up 19% over the previous year, reaching $29.1 billion, with its income rising 34% up to $8.8 billion.