Microsoft Profits from Cloud's Success

-Steve

As most of us know, the almighty Cloud is what holds most of our information and documents that we have on our computers safe. This shift from information being saved to data centers connected to the internet, rather than being saved locally has been one of the biggest changes in technology in years. While we the users love having our private documents and information protected by Cloud, this mechanism is making Microsoft very profitable.

For many years Microsoft has been reliant on the sales of their traditional software and computers but lately the consumers has been shifting more towards smartphones and tablets. The emergence of Cloud has Microsoft's shares trading almost at a record high, the company's stock rose 1 percent to $64.27 (Wingfield, Para 5).

Microsoft also recently made a deal with the professional social network, LinkedIn. This deal was worth $26.2 billion dollars. However, they did not officially acquire LinkedIn until December 8th so it did not have that much of an effect on the quarter, which ended December 31st. Microsoft's net income for the quarter was $5.2 billion dollars opposed to the $5.02 billion dollars they profited during the same period the previous year (Wingfield, Para 7).

The sales from Cloud increased 93 percent from the previous years, becoming more popular with businesses trying to move their everyday computing functions into these Microsoft data centers. Along with Cloud, Microsoft's business has also been successful resulting in more customers purchasing the subscription to Office 365. This resulted in a 10 percent increase to $7.4 billion dollars (Wingfield, Para 13).

However, while most categories of Microsoft are being profitable, the personal computer market has been down due to the rise in consumers desire for tablets and smartphones. Microsoft is making up for this in improving their Windows 10 software on their personal computers, trying to entice more
buyers.

Overall, Microsoft has made various improvements to their company and it has resulted in great success and profit. But as time goes by technology gets outdated and in order to stay successful Microsoft it going to need to stay on top of their game and keep producing top notch software and products. We have seen this with Cloud, but what will be next?

Sources:
Wingfield, Nick. "Microsoft Rises 4 Percent as Cloud Business Booms." The New York Times. N.p., 27 Jan. 2017. Web. 28 Jan. 2017.
O'Sullivan, Fergus. "Microsoft Freezes All Security Updates For February." TechFrag. N.p., 15 Feb. 2017. Web. 12 Apr. 2017.