Microsoft is known for its huge revenue from office software. However, things are likely to change in 2022.
The year 2022 is predicted to be a breakthrough milestone in corporate history. This was the year that Microsoft was able to complete its successful transition, moving from revenue dependent software installed on users’ devices to cloud based software running on a remote server basis.
When CEO Satya Nadella took over Microsoft in 2014, he steered the company into a new strategy. Every passing year, people see the company reaping new successes from there. In the next fiscal quarter, revenue from Azure cloud services is forecast to reach $ 7.2 billion, contributing 17% of the total. Three years ago, the percentage was only 4%.
Under the leadership of the Indian-American CEO, Microsoft is about to reach a milestone in history
Most analysts recommend buying on Microsoft shares because the company has proven, the cloud is really suitable to drive the whole business. Azure even surpassed the Windows product line, which made Microsoft the most valuable and most powerful company in the world in the 1990s. According to the company, Windows revenue last quarter was 5.7 billion. USD.
And as analysts expect, it is only a matter of time for Azure to be strong enough to overtake Office, including both for user subscription and traditional licensing fees, Office 365. “We believe that in fiscal quarter sales ending June 2022, Azure will overtake Office for the first time – $ 11.8 billion vs. $ 10.9 billion” – expert Bracelin writes in an email to CNBC.
Officie relies heavily on the decades-old platform that Microsoft has built. The first is Word, the company’s word-processing software released in 1983 and the oldest component of Office. Meanwhile, Azure is born in the era of Internert boom. The company started operating Azure in 2010 with the original name Windows Azure.
Gartner estimates that in 2019, Azure accounts for 17.9% of the cloud services market, ranking second after Amazon Web Services (45%). They are followed by Alibaba (9.1%), Google (5.3%) and Tencent (2.8%). Microsoft maximized its Azure business during Nadella’s time, especially deals with big companies like Sony and Salesforce.
Forget the office software or the operating system, Microsoft will make more money in the cloud than anything, than Windows and then will more than Office. All thanks to the design hand of executive Satya Nadella.