According to an enterprise software survey conducted by Credit Suisse about cloud platforms, nearly 40% of those surveyed expressed Microsoft Azure as their preferred choice. That number has grown 21% over the last six months. Another survey by data analytics firm Sumo Logic also came up with a similar result. Clearly Microsoft’s (Nasdaq: MSFT) Azure focus is bearing fruit. It is also evident in its latest financial results.
Microsoft’s Financials
Microsoft’s Q4 revenues grew 3% over the year to $24.7 billion, ahead of the market’s forecast of $24.31 billion. EPS of $0.83 was also ahead of the Street’s expectations of $0.61 for the quarter.
By segment, revenues in Productivity and Business Processes grew 21% to $8.4 billion driven by a 43% growth in Office 365 commercial revenues. Within the segment, Office consumer products and cloud services revenue increased 13% and Office 365 consumer subscribers grew to 27 million. Dynamics products and cloud services revenue increased 7% due to a 74% growth in Dynamics 365 revenue. LinkedIn contributed revenue of $1.1 billion during the quarter.
This was the first quarter that LinkedIn revenues surpassed $1 billion since its $26.2 billion acquisition last year. A quarter ago, LinkedIn had brought in $975 million in revenues. To continue to drive growth, Microsoft recently announced the rollout of a Windows 10 app for LinkedIn. The app will offer an integrated LinkedIn experience including real-time notifications, new messages, insights on calendar, trending news in your industry, and other updates.
Revenue in Intelligent Cloud grew 11% to $7.4 billion with Server products and cloud services revenue growing 15% and Azure revenue growing 97%. Enterprise Services revenue decreased 3% over the year.
Revenue in More Personal Computing was $8.8 billion and recorded a decline of 2% over the year despite a 1% growth in Windows OEM revenues. Windows commercial products and cloud services revenue increased 8% but Surface revenues fell 2%. Search advertising revenue excluding traffic acquisition costs increased 10% and gaming revenue increased 3% over the year.
