Microsoft Financial Results FY21


$168.1 billion.

That was Microsoft’s revenue for FY21, which ended June 30, 2021, and it is a pretty staggering number! In fact, it’s about 40% bigger than the revenues of Oracle, SAP, and IBM combined!

Equally impressive was their Operating Income number of $69.9 billion but let’s dive a bit deeper and look at the numbers for Q4 FY21 (April – June 2021).

Q4 FY21

Overall for the final quarter, Microsoft saw:

  • Revenue = $46.2 billion – up 21%
  • Operating Income = $19.2 billion – up 42%

(As a comparison – Microsoft’s Q4 revenue was bigger than the individual total year revenue for both Oracle and SAP!)

Productivity & Business Processes

This division had revenue of $14.7 billion, an increase of 25% and within that:

  • Office 365 Commercial increased 25%
  • LinkedIn increased 46%
  • Dynamics 365 increased 49%

Intelligent Cloud

Here Microsoft saw revenue of $17.4 billion, a 30% increase, which was mainly driven by a 51% increase in Azure revenue.

More Personal Computing

This section saw a 9% increase to $14.1 billion with Windows Commercial products rising by 20%; however – Surface revenue dropped 20%…likely impacted by the ongoing chip shortage.

Other areas

The investor calls and information can give great insights beyond simply revenue figures, some of these tidbits include:

  • Another increase in long term Azure deals
  • Office 365 E5 comprises 8% of the total commercial installed base
  • Almost 250 million monthly active users on Teams
  • Almost 80 million monthly active Teams phone users
  • Over 1 billion Teams calls in a single month
  • Almost 600,000 orgs using Microsoft security products – with a 70% increase in SMB

Microsoft continue to grow and Satya Nadella seems confident they will be able to keep this up going forward. It certainly feels that there is a lot of expansion space available for Microsoft across several product areas – both winning business from rivals but, probably more so, creating brand new sectors in the cloud and across business applications too.

Further Reading

Microsoft Investor Info

Microsoft extend Extended Security Updates


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Extended Security Updates (ESUs), available for Windows Server 2008/R2 and SQL Server 2008/R2, were introduced in 2019 to extend available security support for 3 more years beyond the end of the products’ extended support periods.

It’s now less than 12 months until the end of the ESU period for SQL Server 2008/R2 and Microsoft have announced they will be providing 12 additional months of cover – but only for workloads running in Azure. This will also apply to Windows Server 2008/R2 – the end of ESU dates are:

  • SQL Server 2008/R2 – July 12, 2022
  • Windows Server 2008/R2 – January 10, 2023

End of support for 2012 Server versions

They have announced the availability of ESUs for the 2012/R2 releases of SQL Server and Windows Server. Extended Support for these ends:

SQL Server 2012 – July 12, 2022

Windows Server 2012/R2 – October 10, 2023

It’s now less than 12 months until SQL Server 2012 goes out of support so if you’re using that within your organisation, you need to come up with a plan to:

  • Upgrade on-premises
  • Migrate to Azure for free ESUs
  • Budget to purchase on-premises ESUs

See more info from Microsoft here.

Microsoft announces Windows 365


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A new member of the 365 family has joined us – alongside Office 365, Microsoft 365, and Dynamics 365 – we now have Windows 365.

Formerly known as Cloud PC, this latest offering enables you to stream an entire PC – including the OS, apps, and settings – from the cloud to any device. This means Windows 10 and 11 will be easily available on any device – including MacOS and Linux.

Although clearly driven by the COVID-19 pandemic and the rapid, global shift to hybrid working, something like this has been a long time coming in many regards. It’s also driven by the changing security landscape…Microsoft also see this as a way to help organisations combat the rise of security threats – let Microsoft take care of securing your desktops so you don’t have to.

Although specific pricing information hasn’t been released yet, it’s expected there will be a range of pre-set options, making it more of an “off the shelf” SaaS offering than the current Azure Virtual Desktop (AVD). Different SKUs and plans will offer different amounts of storage, processing power, memory etc. for organisations to choose from, with Satya Nadella stating this offering would be applicable to businesses of any size.

Options available

Get started with Windows 365 – Microsoft Tech Community

Licensing requirements

Users with Windows Pro endpoints require:

  • Windows 10 Enterprise E3 + EMS E3

while users with non-Windows Pro endpoints require:

  • Windows VDA E3 + EMS E3

Alternatively, both scenarios can be covered by licenses for:

  • Microsoft 365 F3/E3/E5/Business Premium

Technical requirements

It’s not quite as straightforward as just having those licenses, you will also need:

  • Azure subscription
  • Azure Virtual Network
  • Azure Active Directory sync
  • Certain ports open

to ensure that everything works optimally.

More information on the requirements and how to provision can be found here.

Finally…

Not surprisingly, there will be 2 flavours available:

  • Windows 365 Business
  • Windows 365 Enterprise

and it is set to launch on August 2, 2021. I look forward to seeing more information as it becomes available…and hopefully trying it out myself!

Update

While Microsoft are yet to announce official pricing, pricing for 1 SKU has been revealed. For a desktop with 2vCPU/4GB RAM/128GB storage it will $31 per user per month ($372 per year) – which strikes me as quite expensive…

Further Reading

Microsoft announcement

Windows 365 page

Technical requirements

Azure Virtual Desktop


Windows Virtual Desktop (WVD) has been renamed to Azure Virtual Desktop (AVD) – a name change that suggests a broadening of its capabilities and market positioning. More than just a rebrand though, Microsoft have added a range of new capabilities as well as new licensing options.

Typically, AVD is licensed via users’ existing Microsoft 365 licenses but Microsoft have added a new “per-user” app streaming option, aimed at enabling organisations to offer AVD SaaS solutions to external users and customers.

Pricing

Currently AVD per-user is on promotional pricing meaning that “streaming first-party or third-party applications to external users” can be done free of charge from July 14, 2021 to December 31, 2021. From January 1, 2022 pricing will be:

  • $5.50 per user per month (Apps only)
  • $10 per user per month (Apps + Desktops)

You can see Microsoft’s announcement here.

Microsoft Financial Results: Q3 FY21


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Microsoft’s financial results for Q3 FY21 (Jan – Mar 21) are in and, as usual, they’re pretty impressive.

  • Revenue = $41.7 billion – up 19%
  • Operating income = $17 billion – up 31%

Looking at the different product divisions we can see:

Productivity & Business Processes

Revenue = $13.6 billion – up 15%

Office 365 Commercial was up 22%, LinkedIn increased 25%, and Dynamics 365 was up 45%.

Microsoft Teams is up to 145 million daily active users, almost doubling YoY and Office 365 Commercial has nearly 300 million paid seats. Office Commercial products (on-premises Office) was down 25% – continuing its downwards trend as organisations continue to move to the cloud.

Satya Nadella revealed that Power Platform now has almost 16 million monthly active users, an increase of 97%, and revenue has increased by 84%. Amy Hood (CFO) called out Power Apps and Dynamics 365 Finance & Operations as strong performers.

Intelligent Cloud

Revenue = $15.1 billion – up 23%

Azure growth was 50% yet again, with Amy Hood highlighting an increase in the number of large, long-term Azure contracts.

On-premises server products grew 3%, although that seems to largely be due to year on year currency fluctuations, and the EMS install base grew again, now sitting at 174 million seats.

SQL Server on Azure VMs grew 129% YoY alongside Cosmos DB growth too.

More Personal Computing

Revenue = $13 billion – up 19%

Again there was a big difference in Windows OEM as Pro revenue declined 2% but non-Pro grew 44%.

See the Microsoft details here.

Microsoft acquire Nuance


Microsoft announced this month ( April 2021) that they’ve acquired Nuance Communications for $19.7 billion – their 2nd biggest acquisition behind LinkedIn.

You may be familiar with Nuance for their Dragon Naturally Speaking speech recognition software and/or Power PDF but the focus for Microsoft is their work in the Healthcare sector – much of which is built on Azure. It follows Microsoft’s announcement of their “Cloud for Healthcare” vertical offering and clearly indicates they see it as a growth market for them; they believe it will bring their Total Addressable Market to $500 billion in the healthcare provider space – even a small piece of that will make that $20 billion seem like small change!

Going forward, Nuance will be included within Microsoft’s “Intelligent Cloud” division and Nuance will retain its CEO, Mark Benjamin, who will report into Scott Guthrie – executive vice president of Cloud & AI at Microsoft.

See Microsoft’s announcement here.

Microsoft Windows Server 2022


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Microsoft have announced that Windows Server 2022 is in preview and will be available “later” in 2021.

According to this Microsoft page, new security features include “Secured-core server” and Credential Guard while it also brings interoperability with Azure Arc – the service that allows Azure policies to manage on-premises and multi-cloud resources – and Storage Migration Service, which helps connect on-prem file servers to those in Azure.

There are also several updates relating to Containers – all of which show Microsoft’s focus. Although this is a new on-premises server OS, it’s all about connecting to the cloud and enabling a smooth, hybrid infrastructure.

You’ll be pleased to know that there’s no sign of any changes to the licensing model at this stage 😁

Microsoft financial results: Q2 FY21


Microsoft have, once again, had a stellar quarter (Oct-Dec 20) with overall results of:

  • Revenue up 17% to $43.1 billion
  • Operating income up 29% to $17.9 billion

Looking deeper into specific product categories and areas we can see:

Productivity and Business Processes

Revenue was up 13% to $13.4 billion which included:

  • Office 365 Commercial up 21%
  • Dynamics 365 up 39%
  • LinkedIn up 23%

Intelligent Cloud

Revenue was up 23% to $14.6 billion and Azure was revenue growth of 50%

More Personal Computing

The “other” parts of Microsoft’s business all saw success to with revenue up 14% to $15.1 billion. This included:

  • Windows Commercial up 10%
  • Xbox up 40%
  • Surface up 3%

Microsoft’s results are very consistent and are outperforming pretty much every comparable competitor you can think of…Oracle, SAP, and IBM are very far away from numbers like these! Amazon are still seeing great success with AWS – currently rising around 28% – but that is a greatly limited portfolio when compared to that under Satya Nadella’s control.

There are several areas of Microsoft’s product line-up which are at the very start of their evolution and will grow and continue these results for the foreseeable future.

See the full info from Microsoft here.

Microsoft Product Terms, February 2021


Microsoft have stopped producing the standalone Product Terms document and have officially launched the Product Terms website as a replacement.

I’ve been a big fan of the Product Terms document for a long time and I’m not 100% happy about this change tbh! The ability to filter the site by program (EA, MPSA etc.) and product (M365, SQL etc.) will probably make it less confusing for many people – showing only the info that’s relevant to their search.

However, being able to see everything altogether was great for spotting any changes, missing bits etc. that Microsoft hadn’t highlighted and that isn’t as easy on the new site.

My initial concern was that not having a point in time downloadable copy would put customers and partners at a disadvantage, giving them nothing to reference in future conversations. However, having played with the site a little bit it turns out you can download a document from the site. It’s quite similar to the previous document although you have to filter by program, so you don’t get a document that allows comparison across the different licensing options.

The changes in February 2021 are:

  • Addition of Microsoft 365 F5 SKUs (more info here)
  • Planning Services & Training Vouchers SA Benefits have been removed
  • The free Audio Conferencing promos for EA/EES/CSP have been extended to June 30, 2021
  • Clarification that the Microsoft 365 E3/A3 Unattended license doesn’t require a Qualifying Operating System
  • Updates to terms for Azure Maps and Cognitive Services

Microsoft Azure Purview


Image by Gerd Altmann from Pixabay

The latest Azure offering, Purview, is a “unified data governance” service to help organisations manage data across their ever expanding environments – including on-premises, IaaS multi-cloud (Azure, AWS etc.) and also SaaS services. According to Microsoft, Azure Purview will offer automated discovery and classification of data, a map of where it all resides and how it relates to each other, easy searching to locate data, and an overview of how data moves across your organisation.

Given the increasing amounts of data we all create and collect, combined with the rising threat of cyber attacks – at a personal, corporate, and national level – this is a welcome introduction.

Pricing

Azure Purview is (almost) free to try until February 28, 2021 but we can already see an overview of how it will be priced going forward.

First of all, you need to provision the “Data Map” – this is priced based on 2 things…Capacity Units and metadata storage.

Capacity Units

This is a set of resources provisioned in order to keep your Data Map up and running. One Capacity Unit can support “approx. 1 API call per second” and is currently priced at $0.342 per hour.

Metadata storage

This stores the metadata associated with the scanned assets which enables the searching capabilities within Purview. Microsoft talk about this being in a “graph” format – so this appears to be another element of the “Microsoft Graph” being surfaced as part of a product. Pricing is yet to be announced but will be on a per GB basis…I can well imagine many organisations finding themselves with a HUGE amount of this metadata storage!

Scanning

When it comes to scanning your environment, this is charged at $0.63 per “v-core hour” that you consume whilst actively scanning. Microsoft state there will be no “incremental charges” for connectors to 3rd party datastores.

Almost regardless of cost, I think many organisations will find it hard not to use this service – given the worries, risks, and potential fines that data mismanagement can bring. Microsoft have made another strong move to position themselves as an integral part of the future of business. Even if everyone stopped using Windows and Office tomorrow, Azure Purview (and other new services) would keep Microsoft at the forefront of many an organisation’s mind for years to come.

Further Reading

Azure Purview page

Azure Purview pricing

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