This force is about to ‘overwhelm’ Microsoft Office

According to analyst Brent Bracelin at investment firm Piper Sandler, this will be a major milestone, highlighting Microsoft’s successful transition from on-premises software (traditionally deployed) to cloud services, since Satya Nadella took over the company from Steve Ballmer in 2014.

Piper Sandler estimates Azure division’s final-quarter revenue of $ 7.2 billion, or 17% of Microsoft’s total revenue, compared with 4% three years ago. Microsoft does not disclose the specific amount of money Azure brings. Meanwhile, according to the calculations of analysts from the firm William Blair, revenue from Azure is 7.4 billion dollars.

That means Azure is significantly larger than Windows, a product launched in 1985 contributed to making Microsoft the most powerful and most valuable technology company in the world in the 1990s. Windows contributed 5.72 billion USD in the same period. Azure also outperformed Office 365 in revenue.

Thus, Azure “overtakes” all of Office, including the traditional Office 365 and Office subscriptions, is only a matter of time. Piper Sandler predicts this to happen next year. Specifically, in June 2022, Azure revenue will be 11.8 billion USD, and Office will be 10.9 billion USD.

Microsoft Office products have been around since 1989, in which Word word-processing software is the oldest, dating back to 1983. Under the leadership of CEO Nadella, Microsoft switched many of its corporate customers from licensing. Office software to Office 365.

In contrast, Azure launched in 2010 under the original name “Windows Azure”. In 2019, market research firm Gartner estimated Azure to be about 40% the size of Amazon Web Services, the cloud service Amazon introduced in 2006.

Both Office 365 and Azure were born under the former CEO Ballmer, but it was Nadella who made Azure an impressive force, forming partnerships with companies that were once rivals to Microsoft, including Salesforce, Sony. He was also in charge of Azure before becoming CEO of Microsoft.

In his statement after Nadella as CEO in 2014, Microsoft said he led major strategy and critical technical shifts across all products and services, most notably moving to the cloud and broadcasting. developing one of the world’s largest cloud infrastructures to support Bing, Xbox, Office 365 … It is the foundation in the company’s strategic direction.

According to CNBC