Microsoft reported annual revenues in excess of $100 billion for the fiscal year 2018 ending June 30, the first time it's reached this summit in its four-decade-old history.
Microsoft made the revelation during the recent release of its fourth-quarter earnings report, which also showed year-over-year improvements in all its major business segments, especially at its commercial cloud unit.
The report confirms the past fiscal year also saw major growth for Microsoft's gaming business. Gaming took in revenues of $10 billion for the first time - another Microsoft first. The jump positioned Microsoft as the number two gaming firm behind Sony, which earned more than $17 billion from gaming, but ahead of Nintendo and its $9 billion in revenue for its last fiscal year.
The fiscal 2018 results mean Microsoft has beaten earnings estimates every quarter since early 2016. CEO Satya Nadella said Microsoft can do a lot more. "Our opportunity has never been greater," said Nadella.
"We will continue to innovate and invest across our solution areas in serving our customers and their unmet and unarticulated needs. With this tremendous opportunity comes great responsibility. We're relentlessly working to instill trust in technology across everything we do. It's why we will continue to lead the industry dialogue on trust, advocate for customer privacy, drive industry-wide cybersecurity initiatives, and champion ethical AI."
An unwavering focus on resolutely servicing its largest accounts and a wider reliance on its commercial cloud apps are behind this historic event for Microsoft. All the company's divisions performed better, said, analysts.
Commercial cloud, the Microsoft service that includes Azure, Office 365, Dynamics 365 and Windows cloud revenues which are part of Microsoft 365, contributed revenues of $23 billion. Surface contributed $4.6 billion. Gaming brought in $10 billion and LinkedIn, $5 billion. Windows Pro had a stellar Q4, with revenues increasing by 14 percent.
Revenues from Microsoft's line of Surface products in the fourth quarter rose 25 percent, to $1.2 billion. Microsoft-owned LinkedIn grew revenues by 37 percent during the quarter while boosting its membership base to more than 575 million.
The laudable revenue results, however, came with immense pain and follow a massive reorganization that saw Microsoft fire thousands of employees. Microsoft also reduced the number of enterprise accounts and only kept the largest. The others it transferred to the Small, Medium and Corporate (SMC) segment.
Its renewed focus on enterprise accounts sees Microsoft employees working alongside these major customers in crafting new software, services, and others. It also terms these enterprise clients as "partners."
Microsoft "closed a record number of multimillion-dollar commercial cloud agreements and more than doubled the number of $10 million-plus Azure agreements," in fiscal 2018 said Chief Financial Officer Amy Hood.
