We bring this up all the time, but if you look at Microsoft and where’ they make their money it’s not in the consumer markets. This was from a year agoAs of last year they were making over $1b from Office and Windows; Xbox, SQL Server; System Center; Unified Communications; SharePoint; Developer Tools; Dynamics (ERP & CRM); and Online display and search advertising (but they post huge losses in search as well). “ Guess what? This is still the same Microsoft. Let’s see where they made money this quarter:

  • The Server & Tools business posted $4.57 billion in third-quarter revenue
  • The Microsoft Business Division reported $5.81 billion in third-quarter revenue
  • The Windows and Windows Live Division posted revenue of $4.62 billion

Meanwhile…

  • The Online Services Division reported …operating loss improvement of approximately $300 million
  • The Entertainment& Devices Division posted revenue of $1.62 billion, a decrease of 16%

This isn’t going to change. Microsoft’s real money is and continues to be on the corporate side. yes, that consists of Windows and Office but also heavily relies on database and server solutions and the Business Division includes Lync. We’re used to looking at Microsoft for PC sales. Those were up 4% over the past year. It’s ok – nothing spectacular. But the things we think of when we think about Microsoft (like Xbox, Kinect, Bing, Skype and Windows Phone) are squat. That’s sort of what makes this so interesting. We’re at a point where Microsoft is trying to make significant inroads into the consumer markets. Can they pull this off? If they can get Microsoft in your pocket and on your tv and powering your video calls then they can really explode as a company (well relative to their stock – not like Apple but Apple’s not on the same page as any other company).

So, by the end of the year will Microsoft become a company that’s actually making money off of consumers? Shout out

4 COMMENTS

  1. I feel Microsoft is coming in slowly, and could do a lot better by learning from their past mistakes, and the mistakes of their competitors, and if they played well with the hacking community then they might even take off further into the sky. I LOVE my Windows Phone, that being said there are still some things missing from the OS that would really make it a really, really kick ass phone. I know they will eventually conquer the consumer market, and if not conquer at least be one of the main two contenders, I just hate that it’s taking too long for that to happen.

  2. “Sticking to the enterprise market, huh. How’s that working out for RIM?

    LOL! Check RIM’s financials ginger-boy, then check Microsoft’s! I think even a Microsoft hating idiot like you would see the difference.

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