Microsoft - What happens next?
Even though Microsoft's quarterly figures are almost a month old, I would like to talk to you about them. Since the recovery from the corona crash, Microsoft has continued to stabilise its sideways movement within the €200 and €170 channel. How should things go from here?
The buzzword is growth!
Looking ahead to the first quarter of the new year, Microsoft shows what potential they see in themselves, despite the company's gigantic size. Sales are expected to increase by 12%, operating income by 25% and net income by 30%.
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It is also noticeable that growth in the business highlights is in the double-digit percentage range. Microsoft is known to understate its forecasts in order to have a more positive impact when the figures are higher.
How does Microsoft make its money?
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Productivity and Business Processes, Intelligent Cloud and More personal Computing are the segments. The largest share comes from the Intelligent Cloud segment, which also includes the "new" Azure Cloud. Microsoft has operated Azure with a growth of 50% in the last quarters. In the business highlights (see above) you can see that Azure is now only aiming for a growth of 48%. The success of Azure will now pay for itself more and more over time. The smallest segment profits from the market power of the last decades, as Microsoft is still associated with its products like or with the operating system "Windows". Productivity and Business Processes are the Microsoft products we use to increase our productivity. Examples are "Word, Excel, LinkedIn, etc.", but also entertainment products like the "Xbox" are among them. Margin is very important for tech companies, so we are pleased to see that it has also increased.
More "More personal Computing"?
The impressive thing about Microsoft in itself is the new ideas for subscription models.
One example: The Xbox 360 was modern and popular for its time, and unlike Sony's Playstation 3, Xbox users had to pay money for the online multiplayer function. With the Playstation 4, Sony also introduced the payment service. To encourage customers to continue using the paid "Playstation Network", Sony offers two games a month as free content. With its new series x/s, Xbox has expanded the established payment service more than Sony. In addition to the multiplayer function, the so-called "Game Pass" contains over 200 games as download content.
Microsoft thus binds more users to various subscription models.
I keep this blog entry a bit shorter than usual (e.g. fundamental data is missing).
What do you think about it? More information and therefore longer or shorter and more concise?
Good article, Microsoft is one of the oldest companies in the market that is in a constant change that allows it to be profitable in the time.
Yes, they reacted correct to Change for Cloud computing. The german companie SAP missed an early interest in Cloud computing, now SAP is struggles with the Change. I think I will make an Investment in Microsoft for Long Terms.