As PCs decline, Microsoft betting its future on the cloud

Software companies love to say that they’ll make more money from customers over the long run by migrating them to cloud subscriptions, even though they get paid less up-front and often see lower margins on cloud subscriptions than they do on traditional software sales. That was fueled by the staggering growth of Azure, its cloud computing platform, which more than doubled.

Microsoft indicated that services like Cortana Intelligence and Azure IoT Suite could be used to augment Boeing’s existing analytics suites.

Microsoft says it’s now on pace to generate more than $12 billion in sales annually from commercial cloud services.

Revenue from phones declined by 71% from the same quarter a year earlier.

“Globally, airlines spend about US$700 billion on operating costs, and there’s about US$700 billion in revenue”, he said.

The airline industry has traditionally been ripe for technological innovation – and a couple of examples have hit CloudTech’s inbox with regard to how different providers are now utilising big data and cloud. That beat Wall Street’s average forecast of $22.1 billion. Microsoft also wrote down a $1.1 billion charge related to the fallout from its purchase of Nokia and subsequent restructuring in the phone division.

This is the first step in a much larger collaboration between the two companies, enabling global customers to take advantage of Microsoft’s enterprise cloud applications. Sanford Bernstein analyst Mark Moerdler said Microsoft is finally making headway shifting Microsoft Office software clients onto subscription-based cloud services. “People looked at Office as a product that was going to be in decline”, said Moerdler. Total revenue for the three months ended June 30 was $20.6 billion, Microsoft said, down from $22.2 billion past year. So far his plan has been well received by investors.

Under the agreement Boeing will move its extensive portfolio of digital solutions to Microsoft Azure, which aims to provide Boeing and its customers with access to those applications in order to make them more efficient, Microsoft announced Monday in a blog post. The S&P 500 is up 31 percent in the same time. The company’s stock was up about 4 per cent in after-hours trading Tuesday following the earnings report.