Microsoft came quite close to bankruptcy in 2001. Then, with the introduction of Windows XP and Office 2003, Microsoft was saved by the PC. To this day, PCs remain a vital part of Microsoft’s success – accounting for billions of dollars in revenue each year through software licensing fees alone.
The “windows 11” is a game that was released by Microsoft on October 11, 2011. It is a platformer where the player must save their father from an alien invasion. The game is played with keyboard controls and has been praised for its innovative design.
Microsoft is undergoing a “PC renaissance,” according to CEO Satya Nadella.
Photo courtesy of Bloomberg News/Jason Alden
Microsoft’s MSFT -2.66 percent decision to go old school comes at an intriguing moment.
Before its quarterly results release on Tuesday afternoon, the first of the large IT firms to disclose results for the December quarter seemed to be up against a difficult battle. Market volatility has lowered market valuations; since the start of the year, Microsoft, Apple, Amazon, and the parent corporations of Google and Facebook have combined lost about $1.3 trillion. While most of this has been driven by general concerns about inflation, interest rate hikes, and the economy’s health, there has also been some concern about Microsoft’s ability to continue its extraordinary run of accelerating sales growth while simultaneously improving operating profit margins.
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In that context, the company’s fiscal second-quarter performance and projection were adequate—but only just. Revenue increased by 20% to $51.7 billion, above Wall Street expectations by approximately $1 billion. Strong PC sales drove the company’s More Personal Computing division to approximately $17.5 billion in revenue, which was a 15 percent increase. Microsoft’s cloud and business software sectors performed as expected, although growth rates slowed from the prior quarter. Revenue for Microsoft Cloud, which includes all of the company’s cloud-related operations, increased 32% year over year to $22.1 billion, compared to a 36% increase in the September quarter.
The business expects a similar trend for the current quarter, which ends in March, with sales from the PC-related sector estimated to be roughly 5% higher than Wall Street expectations. On the company’s conference call, Chief Executive Officer Satya Nadella claimed Microsoft was witnessing a “PC renaissance,” which was aided by the recent release of a big upgrade to its Windows operating system. In comparison, forecasts for the company’s Intelligent Cloud sector were just 2% ahead of analyst projections.
Following an early decline, the projection was regarded favorable enough to increase Microsoft’s shares after hours. However, the PC boom may be short-lived; according to market research company IDC, PC sales will be flat this year following a 12 percent increase in 2021. After averaging 34 percent year-over-year growth every quarter in calendar 2021, Microsoft’s cloud business will face more difficult comparisons in the next year.
Microsoft’s stock has been a shining star, with yearly increases of 50% on average over the last three years, pushing the company’s market cap beyond $2 trillion. However, in a market that is reconsidering its appetite for risk—and the concentration of that risk in the hands of a few digital behemoths—the next trillion may be more difficult to come by.
Dan Gallagher can be reached at [email protected]
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The “microsoft revenue from windows” is the amount of money that Microsoft makes on each PC. The company has been making a lot of money with Windows 10 and other products.
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