Is Microsoft Pursuing the Cloud Computing Market Hard Enough?

February 4, 2015 Off By David
Object Storage

Grazed from StreetWise. Author: Jacob Maslow.

I don’t mean to be a stick in the mud here. I know there are a lot of analysts who are happy that Microsoft (NASDAQ:MSFT) is pursuing the fast-growing cloud computing industry in a very public way. Indeed, Microsoft has made its cloud business strategy the centerpiece of its transition from a traditional desktop-based software company.

This is all well and good. However, if you look at the numbers, it can’t help but leave you with a sinking feeling in your stomach. Let’s put it this way, Microsoft has an annual revenue of close to $100B. That’s how big Microsoft is. We’re talking about its Xbox, hardware initiatives, and of course Windows and Windows-based software. Of that figure, $5.5B came from cloud computing and its cloud business…

While it’s true that Microsoft’s cloud revenue grew at a rate of 300%, this isn’t really much to write home about. $5.5B out of a total revenue base of around $100B seems a bit on the small side. Despite the public relations spin, Microsoft got punished hard. Unless Microsoft can increase its cloud growth rate so that it can account for at least half of Microsoft’s total revenues, it appears that Microsoft has serious issues. Not surprisingly, Microsoft’s shares got punished hard by Wall Street and was hit by several analyst downgrades…

Read more from the source @ http://www.streetwisejournal.com/microsoft-pursuing-cloud-computing-market-hard-enough/5831/