Microsoft Rises Most in Nine Months After Profit Beat Estimates
- Commercial cloud revenue reaches $12.1 billion on annual basis
- Software maker is shifting customers to web-based products
Microsoft Beats Forecast: What's Going Right?
Microsoft Corp. rose the most in nine months Wednesday after reporting quarterly sales and profit that topped analysts’ estimates, rekindling optimism about Chief Executive Officer Satya Nadella’s cloud strategy as more customers shifted to the company’s internet-based software and services. Shares jumped as much as 5.9 percent.
Nadella, well into his third year at the helm, has been reorienting Microsoft’s business around cloud and productivity services to fuel growth as traditional software sales shrink. Annualized revenue from commercial cloud products was more than $12.1 billion in the recent quarter, a number that Microsoft has pledged will reach $20 billion by fiscal 2018. The company is relying on the switch to recurring cloud contracts to help make up for weaker one-time corporate software purchases, which are still on course to decline but came in stronger than the company projected in the recent quarter.