Microsoft Cloud Strength And Hardware Progress Drive Record 1Q Revenue

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Microsoft Corp. today announced revenue of $23.20 billion for the quarter ended September 30, 2014. Gross margin, operating income and diluted earnings per share (“EPS”) for the quarter were $14.93 billion, $5.84 billion and $0.54 per share, respectively. These financial results include $1.14 billion of integration and restructuring expenses, or an $0.11 per share negative impact, related to both Microsoft’s restructuring plan announced in July 2014 and the ongoing integration of the Nokia Devices and Services (“NDS”) business.
 
Almost as embarrassing as oil monopoly "revenues" imo. Unrestrained capitalism and greed on a scale never seen before in human history.

As long as the company is allowed to continue their existing sales and support policies (e.g. dictating specific Windows versions on new PCs, non-transferability of OEM licenses etc) they remain entirely separate from the free market and masters of their own revenue destiny.
 
Almost as embarrassing as oil monopoly "revenues" imo. Unrestrained capitalism and greed on a scale never seen before in human history.

As long as the company is allowed to continue their existing sales and support policies (e.g. dictating specific Windows versions on new PCs, non-transferability of OEM licenses etc) they remain entirely separate from the free market and masters of their own revenue destiny.
Windows isn't even number 1 in their revenue stream anymore. OEM Licensing is way down. They get all their money from enterprise software and the cloud now. Though their hardware business appears to be growing well. They almost sold a billion dollars worth of Surfaces.
 
As long as the company is allowed to continue their existing sales and support policies (e.g. dictating specific Windows versions on new PCs, non-transferability of OEM licenses etc) they remain entirely separate from the free market and masters of their own revenue destiny.

You talk a lot about these two things but you've never pointed out exactly where the issue is with them beyond your dislike of them. How do you tell a company that they must sell a specific model of product In-perpetuity? And an number of Windows 8.x versions these days are free, so the transferring of the OS to another device from an economic perspective is meaningless.
 
You talk a lot about these two things but you've never pointed out exactly where the issue is with them beyond your dislike of them. How do you tell a company that they must sell a specific model of product In-perpetuity? And an number of Windows 8.x versions these days are free, so the transferring of the OS to another device from an economic perspective is meaningless.

I heard that banks sell the same product perpetually.
 
Can someone explain how they are making money off "the cloud"? Does this mean subscription based services like office 365 and space on skydrive? Web hosting services? Hard for me to imagine what rakes in billions in that category.
 
Can someone explain how they are making money off "the cloud"? Does this mean subscription based services like office 365 and space on skydrive? Web hosting services? Hard for me to imagine what rakes in billions in that category.

Just about all of Microsoft's proprietary server and front end productivity tools can be hosted in Azure and offered via a subscription model which is essentially the things you listed. But Azure can also host other stacks. A lot of Azure hosting is based on Linux and open source products.

It's easy to criticize Microsoft for its bumbling in the mobile client space but what they're doing with Azure and their cloud offerings overall is top notch, first class stuff. We'll never use Azure for anything much at a big bank, but I've played with Azure on my own for a while now, it's just amazing how much you can stand up quickly without any onsite hardware or software and how easy it easy to migrate certain things over. I do a lot of work with SQL Server and have been looking particularly in that area.
 
*gasp* Banks aren't offering personal checking accounts anymore! OMG! Batten down the hatches! Drop the portcullis! Boil a turkey sammich! And someone change the combination on my luggage!

I said the same "specific model of product in-perpetuity". And I never said that a company couldn't offer the same model of product forever, there's just no way to force that plus as much as some mike like XP or the Model T or free checking, those things are by gone eras.
 
I said the same "specific model of product in-perpetuity". And I never said that a company couldn't offer the same model of product forever, there's just no way to force that plus as much as some mike like XP or the Model T or free checking, those things are by gone eras.

Corn flakes are a popular breakfast cereal originally manufactured by Kellogg's through the treatment of maize. A patent for the product was filed on May 31, 1895, and issued on April 14, 1896.

http://en.wikipedia.org/wiki/Corn_flakes

2013-teen-choice-awards-miley-cyrus-shows-her-tongue-5.jpg
 
And of course nothing has changed in the formulation of corn flakes in the last century. /s

Anywho, Dunk History did an interesting skit about the history of Kellogg's.
 
And of course nothing has changed in the formulation of corn flakes in the last century. /s

Anywho, Dunk History did an interesting skit about the history of Kellogg's.

They're flakes made of corn...since the name hasn't been changed to rye flakes, I'm pretty sure it's still made from corn.
 
They almost sold a billion dollars worth of Surfaces./QUOTE]

Not sure how you're making that leap, that's not what the report said. All we have been told is A) Surface hit revenues of $908 million in the quarter, B) Gross margins were positive in the quarter.

Gross margin is the revenue of the item minus the cost of making it, but doesn’t include R&D, channel development and advertising. The Gross margin for the Computing and Gaming Hardware division was $479 million. The cost of revenue which includes manufacture, advertising and channel development was $770 million, so a loss of almost $300 million.

Surface revenue was up because last year, most being sold were Surface RTs at fire sale prices. This year most sales are the higher priced Surface Pro 3 and Surface Pro 2. That is the reason for the higher revenue.

So in reality fewer Surfaces were probably sold this quarter than the corresponding quarter last year and it still is creating a loss.
 
Gross margin is the revenue of the item minus the cost of making it, but doesn’t include R&D, channel development and advertising. The Gross margin for the Computing and Gaming Hardware division was $479 million. The cost of revenue which includes manufacture, advertising and channel development was $770 million, so a loss of almost $300 million.

Gross margin = revenue - cost of revenue, so you don't need to subtract cost of revenue again. And you're conflating the meaning of cost of revenue. Cost of revenue would include the costs of manufacturing a product but not advertising. Marketing, R&D etc. are operating expenses and are subtracted from the gross margin which is the operating income. Taxes are then subtracted from operating income to produce net income.

I know you'll say defending Microsoft but I've been in the financial industry and have developed a number of apps for financial reporting so this is the kind of error I notice pretty easily.
 
You talk a lot about these two things but you've never pointed out exactly where the issue is with them beyond your dislike of them. How do you tell a company that they must sell a specific model of product In-perpetuity?/QUOTE]No idea, because it's neither what I said or meant. My major issue is that MS implemented WPA and other copy protection only after they had acquired their 90+% stranglehold on the world's desktops, and I'm asking how a company with said monopoly and $90+ billion of annual revenue is justified in maintaining any kind of forced activation process for their software. What are they afraid of, losing market share? Or revenue?? The company has been found guilty in three different countries of illegally maintaining their monopoly, and all you seem capable of worrying about is how MS can monetize and leverage it. Bizarre imo. Every dime they spend on WPA or any other form of activation or copy protection on Windows is a dime they should be fined by our federal government imo.

Internet evolution is following the same path as all other utilities in our country, e.g. the Communications Act of 1934 was our federal government's response to AT&T's monopoly on our landline network. Edison had the same luxury over our electricity network for many years. Etc. When a single company holds a 90+% monopoly on the world's desktops, and therefore access to what has become, easily, the world's most essential communications utility, the two obvious (in fact only) solutions are to nationalize the company, or at a bare minimum the product(s) necessary for access to the utility. Yes I know Linux is free and no it doesn't matter in light of MS's monopoly position. Given the legality of their current sales and support policies there is zero chance of any other company ever competing substantially with Windows, the only thing left to do is force it to the public domain and/or forcibly nationalize the company.

BTW the exact same is true for cable service providers pretending to be ISPs (like Comcast) and search engines like Google. I sincerely hope they're enjoying their Godlike powers over the internet, because these powers are soon coming to an end. Permanently. For the good of the people instead of Microsoft's monopoly. Thank Title II.
 
They almost sold a billion dollars worth of Surfaces./QUOTE]

Not sure how you're making that leap, that's not what the report said. All we have been told is A) Surface hit revenues of $908 million in the quarter, B) Gross margins were positive in the quarter.

Gross margin is the revenue of the item minus the cost of making it, but doesn’t include R&D, channel development and advertising. The Gross margin for the Computing and Gaming Hardware division was $479 million. The cost of revenue which includes manufacture, advertising and channel development was $770 million, so a loss of almost $300 million.

Surface revenue was up because last year, most being sold were Surface RTs at fire sale prices. This year most sales are the higher priced Surface Pro 3 and Surface Pro 2. That is the reason for the higher revenue.

So in reality fewer Surfaces were probably sold this quarter than the corresponding quarter last year and it still is creating a loss.
Umm. I just said they sold almost a billion dollars worth of Surfaces. I didn't say they made money at it. If you earn a revenue of $900 Million, but spent $1.2 Billion, you still sold almost a billion dollars worth of whatever.

Even if they are loosing money at it, it is still another billion dollar business they are building, and it adds more diversification to their basket of goods. If they can start selling a good number of them they can streamline their development and start to make money off of them.

My main point of my first post was that they are no longer just an OEM Windows company anymore.
 
You talk a lot about these two things but you've never pointed out exactly where the issue is with them beyond your dislike of them. How do you tell a company that they must sell a specific model of product In-perpetuity?/QUOTE]No idea, because it's neither what I said or meant. My major issue is that MS implemented WPA and other copy protection only after they had acquired their 90+% stranglehold on the world's desktops, and I'm asking how a company with said monopoly and $90+ billion of annual revenue is justified in maintaining any kind of forced activation process for their software. What are they afraid of, losing market share? Or revenue?? The company has been found guilty in three different countries of illegally maintaining their monopoly, and all you seem capable of worrying about is how MS can monetize and leverage it. Bizarre imo. Every dime they spend on WPA or any other form of activation or copy protection on Windows is a dime they should be fined by our federal government imo.

Internet evolution is following the same path as all other utilities in our country, e.g. the Communications Act of 1934 was our federal government's response to AT&T's monopoly on our landline network. Edison had the same luxury over our electricity network for many years. Etc. When a single company holds a 90+% monopoly on the world's desktops, and therefore access to what has become, easily, the world's most essential communications utility, the two obvious (in fact only) solutions are to nationalize the company, or at a bare minimum the product(s) necessary for access to the utility. Yes I know Linux is free and no it doesn't matter in light of MS's monopoly position. Given the legality of their current sales and support policies there is zero chance of any other company ever competing substantially with Windows, the only thing left to do is force it to the public domain and/or forcibly nationalize the company.

BTW the exact same is true for cable service providers pretending to be ISPs (like Comcast) and search engines like Google. I sincerely hope they're enjoying their Godlike powers over the internet, because these powers are soon coming to an end. Permanently. For the good of the people instead of Microsoft's monopoly. Thank Title II.

But here's the thing. For all of your grievances, I guarantee that if Windows clients for all devices became free for everyone there'd be even more grievances. Long before WPA Microsoft was bought up on anti-trust charges because they "gave away" IE, Windows Media player, etc. A completely free Windows client? There's no way in hell that Linux desktop fans want that.
 
There's no reason MS would need or want to release their flagship product to the public domain, they can choose any of their older internet-capable OS's (7, even XP). Once in the public domain, Windows can be made truly secure. Until that time it's a constant cat and mouse game (the record speaks for itself), with the mouse always being at least two and usually three or more steps ahead of the cat. Perpetually. Again there's no need to defend that claim because it's established history.

I'm not looking for a specific answer to this question, but what do you think would happen if MS released Win7 or XP to the public domain?
 
There's no reason MS would need or want to release their flagship product to the public domain, they can choose any of their older internet-capable OS's (7, even XP). Once in the public domain, Windows can be made truly secure. Until that time it's a constant cat and mouse game (the record speaks for itself), with the mouse always being at least two and usually three or more steps ahead of the cat. Perpetually. Again there's no need to defend that claim because it's established history.

I'm not looking for a specific answer to this question, but what do you think would happen if MS released Win7 or XP to the public domain?

So there are no instances of devastating attacks on public domain software? Haven't there been a few of those lately? It's a cat a mouse game because there's always someone smarter and more resourceful out there that sees things tons of other "eyeballs" don't. With something like Windows that's widely deployed and gives users so much freedom to do whatever, how is anything like that ever truly secure?

As for releasing Windows source code into the public domain, I definitely see a lot of people trying to make a much profit from it however they can, from new malware to clones of Windows. Would it help with security? Some, but nothing that would radically make it more or less secure. Top level hackers don't really need source code to attack bad code, though code would help. Of course Windows would be a very special case. There'd probably be as many eyeballs on a public release of Windows source code in one day as that has ever looked at Linux source.

But again, I don't think that many Linux folks would want that. What would even be the point desktop Linux with a open source version of Linux? Microsoft has it's agenda. And there's plenty of folks that don't like Microsoft that would never want Microsoft's agenda to become theirs.
 
But again, I don't think that many Linux folks would want that. What would even be the point desktop Linux with a open source version of Linux? Microsoft has it's agenda. And there's plenty of folks that don't like Microsoft that would never want Microsoft's agenda to become theirs.

Microsoft can keep old versions of Windows as closed source, thanks. Linux is good enough to do anything Windows can (even gaming is pretty much there now) so I don't think anything would be gained by it.

Have you seen farmers, lol how many years in a row are they going to sell us the same corn.

I know! I keep watching their livestream media events hoping they'll announce a new model this year, but it's always the same stuff. Everyone would love to see an updated cob with modern features, but we just keep getting the same one they announced last year. And the fancorns are awful because they just eat that stuff up and buy more. It's sad, really, the state that industry is in for perpetually selling the same products.
 
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