Microsoft's cloud business slows, casts shadow over results
(Reuters) - Microsoft's Azure cloud business showed slower quarterly growth even as the software maker topped estimates for profit and revenue, indicating that the company may be facing intense competition in its fastest-growing business. Revenue from Azure increased 59% in the quarter ended Sept. 30, but came in well below last year's 76% growth.
(Reuters) - Microsoft's Azure cloud business showed slower quarterly growth even as the software maker topped estimates for profit and revenue, indicating that the company may be facing intense competition in its fastest-growing business.
Revenue from Azure increased 59% in the quarter ended Sept. 30, but came in well below last year's 76% growth.
Since Chief Executive Satya Nadella took over in 2014, Microsoft has been diversifying from its Windows operating system software, and has focused on its cloud services, in which customers move their computing work to data centers managed by Microsoft.
Strength in that business powered Microsoft's market value past $1 trillion (£776.10 billion) for the first time in April. However, the business faces intense competition from Amazon.com's
Worldwide spending on cloud infrastructure services increased nearly 38% year-on-year in the calendar second quarter of 2019 to $26.3 billion, according to data from research firm Canalys. Amazon Web Services still dominates the market with a 31.5% share, with Microsoft coming in second with an 18.1% hold over the market.
Microsoft's shares, up 34% for the year, were 0.5% lower in volatile after market trading.
Revenue from the tech giant's personal computing division, its largest by revenue, rose 4% to $11.13 billion. The unit includes Windows software, Xbox gaming consoles, online search advertising and Surface personal computers.
The software maker's net income rose 21% to $10.68 billion, or $1.38 per share, while total revenue rose 14% to $33.06 billion. (https://bit.ly/2W9G9Bc)
Analysts had expected a profit of $1.25 per share on revenue of $32.23 billion, according to IBES data from Refinitiv.
For a graphic on Microsoft: A Walk In The Clouds:
(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Saumyadeb Chakrabarty)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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