CEO Satya Nadella has pivoted Microsoft toward high-value commercial and cloud applications as the company has shaken off past missteps in the wireless phone handset market. According to industry tracker Gartner, Microsoft has about 7% market share in the public cloud, a distant second to Amazon but still much greater than that of other competitors. Given Microsoft’s massive commercial user base and long-term relationships, we believe that the company is well positioned to grow commercial revenue as the process of digital transformation continues both in the U.S. and internationally. The company’s consumer business is more steady, though it should show better profitability as it laps the disposal of the feature-phone business in November.
Bonner, reflecting on last Thursday’s fiscal Q1 report from the software giant, notes the jump in revenue in various areas of businesses software pertaining to “business processes,” including the 28% jump in Microsoft’s “productivity” division.
This is how CEO Satya Nadella has shifted Microsoft’s business:
Mr Nadella has outlined some first principles based on his vision for Microsoft as a productivity and platform company for the ‘mobile-first, cloud-first world.’