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Clouds Form on Microsoft Q2 2014 (And It's a Good Thing)

Microsoft's cloud vision is having a positive impact on the company's financials, according to the latest earnings filing.

• By Michael Domingo
• 01/31/2014

Microsoft's cloud vision is looking to have some positive impact on the company's financial position, according to it's second quarter earnings report filed by the company. (Microsoft's 2014 fiscal year runs from July 2013 to end of June 2014.) Overall, the company reported a record $24.52 billion for the quarter, or a 14 percent rise from Q2 2013.

"Our commercial cloud services revenue grew more than 100 percent year-over-year, as customers are embracing Office 365, Azure, and Dynamics CRM Online, and making long-term commitments to the Microsoft platform," said Microsoft COO Kevin Turner in a press release.

Commercial revenue topped $12.67 billion. While Microsoft doesn't break out cloud and virtualization revenue into a neat chart, executives during an earnings call last week divulged that it's commercial cloud services revenue more than doubled compared to the year-ago quarter.

"We are seeing broad based adoption, as, Office 365 seats, Azure customers and Dynamics CRM net seat adds all grew over 100 percent," said Chris Suh, Microsoft's general manager of investor relations, who fronted the earnings call. "We now have 70 percent of the Fortune 500 companies using at least one of our cloud services."

Specifically, Suh said that of the 12 percent gain in server product revenue, System Center revenue was well into double-digit territory, and "Hyper-V, our virtualization product, gained 5 points of share over the last year."

For a full earnings picture, see "Microsoft's Strong Quarterly Growth Shows Early Success of Ballmer's 'One Microsoft'" at Redmondmag.com. To hear a replay of the earnings call or to read Microsoft's press release, go here.

On a related note, the rumors continue to get louder that Microsoft is nearly set to announce a new CEO to replace Ballmer, and the lead is Satya Nadella, who leads Microsoft's cloud vision. More here.