Microsoft Corp. just showed why it is the most valuable US firm by showing growth of more than a dozen different companies in tech giant. All but one, basically.
The technology giant reported a better than expected financial fourth quarter Thursday, and the forecast for the coming year still suggested strength. Microsoft
MSFT, + 0.11%
turns on revenue, even excluding a $ 2.6 billion tax benefit, or 34 cents per share, to transfer some of its intangible assets to Ireland, and shares increased 2.7% to their $ 1
Microsoft was led by stellar results in Azure cloud computing, LinkedIn and cloud software segments, with just one laggard: the Xbox gaming industry and its related services. Revenue in the gaming industry fell 10%, as the company launched last year's "Fortnite" combustion services, and sales of the hard drive fell 48%.
These issues are expected to continue, at least until Microsoft solves its next Xbox console that was dreamed for the first time at the E3 conference earlier this year as "Project Scarlett." This release won't happen in this fiscal year, but Microsoft said it expects the revenue of the games to come down slightly this fiscal year, with double-digest growth in software and services offset by falling console sales.
For more: Why Microsoft is suddenly the most valuable company in Big Tech
That was the only bad news out of Thursday's report, as Azure cloud business continued to steal the show for Microsoft. The so-called intelligent shooting segment had the largest revenue figure of Microsoft's three business baskets for the first time last year, increasing sales by 19% to $ 11.4 billion. Azure was up 64%, and Wedbush Securities analyst Dan Ives said the cloud industry "was again the star of the show."
The business continues to gain momentum, says CFO Amy Hood, noting that Microsoft has contracted but not recognized revenues of $ 91 billion, of which about half expect to recognize in the next 12 months. Business executives also spied recent deals of more than $ 10 million, including a large cloud computing contract with AT & T
. One analyst asked if any press releases were accurate that the AT&T deal was valued at more than $ 2 billion.
"It's a very important deal, I'm not going to comment on any specific dollar terms," said Microsoft Chief Executive Satya Nadella said in the company's conference call. "It's the largest commercial deal we've signed and we're seeing have seen many more such deals. "
Productivity and business process software came in at $ 11 billion, an increase of 14%, with strong growth in office products and a surprise in its LinkedIn business, which grew to nearly 1 $ 9 billion in quarterly revenues, proving to be one of Microsoft's best-known acquisitions in recent years, revenue on job seekers' social network jumped 25%, better than consensus at 24% growth, said Michael Turits, a Raymond James analyst.  Revenue wrapping: Microsoft revenue jumps almost 50% and more growth is in the forecast
The PC business was just behind the cloud with a total of $ 11.3 billion in revenue growth of 4% was reduced by the gaming industry. The move to Windows 10, which Microsoft says is a safer operating system, was a major driver and will continue to be the next few quarters when Microsoft stops supporting Windows 7 at the end of the year. The Surface Table even had a strong growth of 14%.
"It's, I think, a recognized momentum with Windows 10 in the distribution of business for security and management value," said Hood.
Nadella has unequivocally demonstrated that his strategy to focus Microsoft on cloud computing was a proper one with two strong fiscal years that made Microsoft a trillion dollar company. If Microsoft can maintain this level of growth through the introduction of the next Xbox, the rest of Big Tech may be too small to challenge the most valuable company around.