Microsoft Azure Now a $1 Billion Business

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According to a top Microsoft executive, the company’s Azure cloud computing unit has brought in $1 billion in revenue in the last twelve months. More than a dozen other Microsoft offerings already bring in at least $1 billion per year.

Bloomberg’s Dina Bass reported, “Microsoft Corp. (MSFT)’s Windows Azure software and related programs have surpassed $1 billion in annual sales for the first time, a sign of progress in the effort to challenge Amazon.com Inc. (AMZN) in cloud computing. The sales milestone for Azure — which stores business information and programs on remote servers and lets customers access them over the Web — was reached in the past 12 months, said Curt Anderson, finance chief for Microsoft’s server and tools unit. Microsoft, the largest software maker, is counting on Azure and other Internet-based business programs to bolster growth as a global personal-computer slump erodes demand for Windows software installed on desktop machines. About 20 percent of companies tapping the cloud use Azure, compared with 71 percent usage for Amazon, according to James Staten, an analyst at Forrester Research Inc. (FORR) Within a year, Microsoft can command as much as 35 percent, he said.”

Janet I. Tu with The Seattle Times noted, “Microsoft has been expanding Azure, recently adding Windows Azure Infrastructure Services, in addition to its ‘platform as a service’ offering. According to Microsoft, Windows Azure currently has more than 200,000 customers and is adding about a thousand more a day.”

Ars Technica’s Peter Bright added, “The billion dollar revenue includes both direct Azure revenue, and revenue from services Microsoft sells to third parties to run their own Azure-like systems.”

According to ZDNet’s Mary Jo Foley, “There are already more than a dozen distinct products/services generating more than $1 billion a year in sales at Microsoft. Those include Windows, Office, Xbox, SQL Server; System Center; Unified Communications; SharePoint; Developer Tools; Dynamics (ERP & CRM); and Online display and search advertising. SharePoint actually crossed the $2 billion a year threshold in 2012. In fact, the Server and Tools Business (STB) at Microsoft is already home to six of those $1 billion businesses. The other six: Windows Server, System Center, SQL Server, Visual Studio, Desktop access business; and enterprise consulting and support.”