Xbox is also doing well: Microsoft is booming thanks to its cloud business

Wednesday January 27, 2021

Xbox is also doing great
Microsoft is booming thanks to its cloud business

The focus on cloud services is paying off again for Microsoft in the pandemic. In the Christmas quarter, however, the new generation of the Xbox game console also generated strong growth.

Microsoft significantly exceeded expectations in the past quarter, thanks in particular to a strong cloud business. Sales rose in the second fiscal quarter ended December by 17 percent to 43.1 billion dollars (35.4 billion euros). Analysts had expected around 40 billion dollars. Profit jumped 33 percent year-on-year to $ 15.5 billion, as the software giant announced after the US market closed on Tuesday.

Microsoft boss Satya Nadella has realigned the group: In addition to the long-standing core business with the Windows operating system and office programs, cloud services – computing power and software from the network – have become increasingly important. In the "intelligent cloud" division, sales grew 23 percent to $ 14.6 billion last quarter. A key factor here was a 50 percent increase in business on the Azure cloud platform, with which Microsoft competes with Amazon and Google. The number of private customers in the Microsoft 365 subscription offer rose from 37.2 to 47.5 million within one year.

In the Windows and hardware segment, the Xbox game console business stood out in particular: a new model brought a 40 percent jump in sales. Windows sales increased by ten percent. Microsoft only mentions the changes in many areas, but not the amount of sales. The income from the tablets and notebooks of the in-house Surface series increased by 3.5 percent to a good two billion dollars.

Last year it became particularly clear that a second wave of digital change is imminent, which will affect every company and every industry, said Nadella. For the current quarter, Microsoft expects further growth. The share rose at times by a good four percent in after-hours trading.