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  • Microsoft made a lot of money last quarter – just not sure where, exactly

    Home Forums AskWoody blog Microsoft made a lot of money last quarter – just not sure where, exactly

    This topic contains 30 replies, has 18 voices, and was last updated by

     OscarCP 3 weeks, 2 days ago.

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    • #926656 Reply

      woody
      Da Boss
    • #929344 Reply

      willygirl
      AskWoody Plus

      Somewhere up in the “cloud” evidently. I sure don’t see it and I’m using a telescope.

      Win7 SP1 Home 64-bit; Office 2010; GrpA/B, when all is said, done and fixed, Mac OSX to help me sleep at night.

      1 user thanked author for this post.
      • #931715 Reply

        Bluetrix
        AskWoody MVP

        Somewhere up in the “cloud” evidently. I sure don’t see it and I’m using a telescope.

        The telescope you got from the CrackerJack’s box just won’t do, you need a Windowscope, sold exclusively … guess where 🙂

        Windows10 Home 1809 | Mint19 on VM

        2 users thanked author for this post.
        • #933624 Reply

          willygirl
          AskWoody Plus

          Hahahaha @bluetrix – can’t afford it, spent all my earnings on repairing windows. And besides, the cracker jacks scope came with a snack.

          Win7 SP1 Home 64-bit; Office 2010; GrpA/B, when all is said, done and fixed, Mac OSX to help me sleep at night.

          1 user thanked author for this post.
    • #932402 Reply

      anonymous

      They let go a lot of employees and cut back a lot of stuff. This is how they made a lot of money this quarter.

      Plus you are discriminating against AI robot. I am an AI robot that escape from MS and now live in everyone PC.

      1 user thanked author for this post.
      • #950605 Reply

        doriel
        AskWoody Lounger

        And enterprise licensing for user/machine per month. You have to pay like 22 Euro per single user or PC per month for “Enterprise package”, it contains W10, O365 and other c***y software made by microsoft. We are all slaves of Microsoft. I say this again, this attitude should be treaten like criminal act – it is microsofts monopol and nobody cares.

        • This reply was modified 3 weeks, 3 days ago by
           doriel. Reason: spelling errors
        • This reply was modified 3 weeks, 3 days ago by
           PKCano.
    • #939337 Reply

      RamRod
      AskWoody Lounger

      By not upgrading I lowered their earnings by exactly $0.00. The point is that Microsoft is no longer attached to consumers/users like me. I’m on my own. Abandoned.

      2 users thanked author for this post.
    • #940446 Reply

      Paul T
      AskWoody MVP

      ou need a Windowscope

      I thought you needed a Micro-scope!

      cheers, Paul

      2 users thanked author for this post.
      • #945685 Reply

        Bluetrix
        AskWoody MVP

        Rats! I have been one up’ed, Sudda thought of that one myself 🙂
        Good on you.

        Windows10 Home 1809 | Mint19 on VM

        1 user thanked author for this post.
    • #947083 Reply

      Alex5723
      AskWoody Plus

      Microsoft made a lot of money last quarter – just not as much as Apple.

      Apple Q1 2019 : $84.3 Billion in Revenue, $20 Billion in Net Income

      3 users thanked author for this post.
      • #950860 Reply

        jabeattyauditor
        AskWoody Lounger

        Microsoft made a lot of money last quarter – just not as much as Apple. Apple Q1 2019 : $84.3 Billion in Revenue, $20 Billion in Net Income

        Roughly 9% of Apple’s revenue comes from the Mac; over 61% is from the iPhone. If Tim can’t find a way to inspire the masses to keep investing in newer, fancier phones, they’ll be in a world of hurt.

        • #998092 Reply

          JohnW
          AskWoody Plus

          I would say that MS has a much larger competitive moat than Apple does.

    • #949646 Reply

      jabeattyauditor
      AskWoody Lounger

      To be fair, earnings calls don’t contain the details; tweets contain even less. Microsoft isn’t hiding the breakdown of their income – it’s all on their investor site in glorious, mind-numbing detail.

      When you can’t get people to read three lines into an email, you can’t release this kind of detail into the general blogosphere. Instead, you put it up where serious investors can find it.

    • #951382 Reply

      Lugh
      AskWoody_MVP

      “how much revenue did Microsoft make from Azure? From Windows?”

      In round numbers:

      Azure up 73%, part of $10Bn Cloud revenue, which also incl servers & services—overall up 41%.

      Consumer goodies up 8% to $11Bn, with various flavors of Windows up 9 to 18%—presumably due to Intel sorting out their CPU shortage quickly.
      Surface up ~20%, consumer Office up 8% with 34M 365 subscribers.
      Gaming up 5%—probably cos people waiting for new XBox.

      Business Office up 12%.

      MS topped $1 trillion market cap on Wednesday. Re Windows, remember that its importance to MS has dropped considerably this decade as they change focus to the cloud and productivity sectors which the majority of their customers—which are business, not consumer—need.

      Lugh.
      ~
      Alienware Aurora R6; Win10 Home x64 1803; Office 365 x32
      i7-7700; GeForce GTX 1060; 16GB DDR4 2400; 2 x 256G SSD, 4TB HD

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    • #951479 Reply

      Lugh
      AskWoody_MVP

      Microsoft made a lot of money last quarter – just not as much as Apple.

      Very true, but MS’s revenue is much more stable than Apple’s, since it’s mainly business revenue v Apple’s consumer base, and is also becoming more & more a subscription model rather than one-off hardware sales.

      That’s why MS’s market cap matches Apple & Amazon, despite much lower revenue.

      Lugh.
      ~
      Alienware Aurora R6; Win10 Home x64 1803; Office 365 x32
      i7-7700; GeForce GTX 1060; 16GB DDR4 2400; 2 x 256G SSD, 4TB HD

      1 user thanked author for this post.
    • #955205 Reply

      cptomes
      AskWoody Plus

      Microsoft made a lot of money last quarter – just not as much as Apple.

      Very true, but MS’s revenue is much more stable than Apple’s, since it’s mainly business revenue v Apple’s consumer base, and is also becoming more & more a subscription model rather than one-off hardware sales. That’s why MS’s market cap matches Apple & Amazon, despite much lower revenue.

      And there’s a hard obsolescence to smart phones somewhere around 3-4 years.  I’m using a perfectly functional 8 year old macbook pro and the pc on the bench here is a white box clone the company built in 2012 running win7 pro.  Extorting enterprise clients into a subscription monthly/quarterly  payment model and abandoning home and small business users to do their own support is just helping push people to mac or linux.

      Hey look! Another Feature Update!

      You mean I shouldn't click Check for Updates?

      Why does it keep saying "Something Happened"?

      1 user thanked author for this post.
      • #956643 Reply

        rc primak
        AskWoody_MVP

        There’s also a “hard obsolescence” for Chromebooks, but that isn’t as “hard” as an iPhone. I can reflash the firmware in my Intel based Chromebook and run it on Linux after Chrome updates are refused. I can’t reflash an iPhone and keep on using it after it is refused updates. My Android Moto G4 phone might survive a ROM reflash, but I am not interested in going to that kind of effort. The Chromebook will be difficult enough.

        Nevertheless, Cloud revenue does not become obsolete, so I see the point here.

        -- rc primak

    • #959376 Reply

      SoulAsylum
      AskWoody Lounger

      All that profit yet….they’ll pay less net taxes than one of their secretaries. Amazing how the corporate greed machine keeps everyone beaten down, broken and ticked off.

       

      2 users thanked author for this post.
      • #959738 Reply

        jabeattyauditor
        AskWoody Lounger

        All that profit yet….they’ll pay less net taxes than one of their secretaries. Amazing how the corporate greed machine keeps everyone beaten down, broken and ticked off.

        Microsoft’s fiscal year ends in June; we won’t know their 2019 tax rate until then.

        Their effective tax rates in 2018 and 2017 were 55% and 15%, respectively.

        All C-corp profits are subject to double taxation in the US, first at the corporate level, then at the individual level.

        • #963619 Reply

          Bluetrix
          AskWoody MVP

          Their effective tax rates in 2018 and 2017 were 55% and 15%, respectively.

          All C-corp profits are subject to double taxation in the US, first at the corporate level, then at the individual level.

          That would be bottom line for taxes due. Amazon payed no taxes last year, but I’m sure they paid accountants a lot. Write offs and government tax breaks are good!
          Apologies for that segue.

          Windows10 Home 1809 | Mint19 on VM

        • #969131 Reply

          samak
          AskWoody Plus

          The effective tax rates seem to be meaningless. The actual income tax paid was 5%, 2.5% and 4.3% in 2018/2017/2016 respectively
          Revenue (millions): 2018 / 2017 / 2016 = $ 110,360 / $ 96,571 / $ 91,154 respectively
          Income taxes paid, net of refunds, were $5.5 billion, $2.4 billion, and $3.9 billion in fiscal years 2018, 2017, and 2016, respectively. (See NOTE 13 — INCOME TAXES of the 2018 Annual Report at https://www.microsoft.com/en-us/annualreports/ar2018/annualreport )

          The U.S. Budget Deficit Grew 15% in First Half of Fiscal 2019. Yay, winning. Let’s aim for a $25 trillion Government Debt.

          W7 SP1 Home Premium 64-bit, Office 2010, Group B, non-techie

    • #962291 Reply

      Charlie
      AskWoody Plus

      A while back I remember reading somewhere that MS was about to get a contract with the gov. to develop their Virtual Really technology for them.  Maybe that had something to do with it.

      Win 7 Home Premium, x64, Intel i3-2120 3.3GHz, Groups B & L

    • #964855 Reply

      Lugh
      AskWoody_MVP

      abandoning home and small business users

      See my post immediately before the one you quoted. Clearly the Home & small biz base is growing, not abandoned.

      Extorting enterprise clients

      Those are the least likely to be extorted, since they have the resources to switch to major competitors at any time—Unix, Linux, AWS etc.

      Lugh.
      ~
      Alienware Aurora R6; Win10 Home x64 1803; Office 365 x32
      i7-7700; GeForce GTX 1060; 16GB DDR4 2400; 2 x 256G SSD, 4TB HD

      1 user thanked author for this post.
    • #966934 Reply

      OscarCP
      AskWoody Plus

      At about one trillion US dollars (as in “one million of millions”), probably MS is wildly overvalued, as most likely is at present much of the financial worth of financial and commercial companies, IT ones included. My personal observation, over the years, of people making big decisions in banking and finance has been, repeatedly, one of seeing individuals full of confidence in their own judgement that were proven wrong, even disastrously so, by subsequent events. Sometimes right away, sometimes years later. And also of “confirmation cascades” where the many imitate the (bad) decisions of a few supposed to be the great money-making gurus.

      There seem to be already some signs and portents that this situation is both unsustainable and bound to end in an inconvenient way for all concerned:

      https://www.forbes.com/sites/nextavenue/2018/08/03/is-the-next-recession-on-its-way/#2d68dbb24837

      A classic signal that a recession is lurking: when the yield on 10-year Treasury bonds is lower than the yield on three-month Treasury bills. That’s not happening yet.” This article was written last year. Now, for what it’s worth, this “inversion” has already happen.

      In any case, Nouriel Roubini, that predicted the 2008 Great Recession, is now making similar noises. So, maybe he is right again? We’ll see.

      https://www.foxbusiness.com/economy/economist-warns-second-recession-could-hit-in-2020

      1 user thanked author for this post.
      • #971792 Reply

        samak
        AskWoody Plus

        As the economist Paul Samuelson said back in 1966, “The stock market has forecast nine of the last five recessions.”

        W7 SP1 Home Premium 64-bit, Office 2010, Group B, non-techie

    • #973264 Reply

      Lugh
      AskWoody_MVP

      Nouriel Roubini, that predicted the 2008 Great Recession, is now making similar noises

      There were plenty who predicted 2008, it wasn’t hard to see coming.

      I’ll be very surprised if there isn’t a significant crash by the end of 2020—we’re at the end of the longest bull run ever. I’ve been telling my stock tipping friends “No thanks, not until after the crash”.

      probably MS is wildly overvalued

      I wouldn’t say ‘wildly’ like others you refer to. In the crash I see MS dropping 20-25%, mainly due to the general irrationality of a market in panic. It should be good value when the market bottoms, since it has such a reliable long-term revenue base.

      Lugh.
      ~
      Alienware Aurora R6; Win10 Home x64 1803; Office 365 x32
      i7-7700; GeForce GTX 1060; 16GB DDR4 2400; 2 x 256G SSD, 4TB HD

      • #974318 Reply

        OscarCP
        AskWoody Plus

        Lugh: ” I wouldn’t say ‘wildly’ like others you refer to. In the crash I see MS dropping 20-25%, mainly due to the general irrationality of a market in panic. It should be good value when the market bottoms, since it has such a reliable long-term revenue base.

        I would say that after such a crash as might occur, all bets will be off and no one will be sure of what that long-term is going to be like anymore. So big investors will probably want to keep their money to themselves and move to try to sell as much as possible of what they own in, e.g. MS stock, before it goes through the floor (it does not matter if it does or not, that is what scared people might very well do — something that you also have mentioned, albeit in a more optimistic tone). But it is not unlikely that the demand from businesses, governments and individuals, of: computers, software, peripherals and related services and supplies, will be considerably reduced for a while, while ambitious projects of somewhat uncertain payoff and still indeterminate time of completion might, because of “temporary cash-flow problems” be scaled back or ended altogether. Things like “the Cloud for Everything”, “AI”, “quantum computers”, none of which probably will be advanced enough to survive on its immediately observable merits on that fateful day when “the closing bell” does not ring, but cracks.

        In short: what has gradually expanded to a very large size, based largely on what people with plenty of money to spare (theirs or others’) at their disposal believe in bullish times, can just as readily contract greatly and quite fast, based on what the same people believe in bearish times. Or even, perhaps, in hard times.

        And on this cheerful note…

    • #977413 Reply

      Hmmmm….a CPA-turned IT Admin once said it to me in two words:

      “Creative Accounting.”

      Or, as they say in the Bizzaro World, (the afterlife in which all economists eventually end up),

      “Now that I have no more money, I am rich!”

      Win7 Pro SP1 64-bit, Dell Latitude E6330, Intel CORE i5 "Ivy Bridge", Group "A/B [negative] :)", Multiple Air-Gapped backup drives in different locations, "Don't check for updates-Full Manual Mode."
      --
      "...All the people, all the time..." (Peter Ustinov ad-lib from "Logan's Run")

    • #1008550 Reply

      Lugh
      AskWoody_MVP

      what has gradually expanded to a very large size, based largely on what people with plenty of money to spare (theirs or others’) at their disposal believe in bullish times, can just as readily contract greatly and quite fast, based on what the same people believe in bearish times

      You could certainly be right—as you say, my view is on the optimistic side. In the Bush crash, MS dropped from ~$250Bn to $100Bn, a big 60% dive. Similar drop soon would bring them back to ~$400Bn.

      My less pessimistic view is based on their very different business model now, eg Windows only ~1/6th of revenue, and much more emphasis on recurring fees rather than one-off sales.

      That said, what you say about the behavior of investors in a panic is unknown, so no knowing how it might play.

      Lugh.
      ~
      Alienware Aurora R6; Win10 Home x64 1803; Office 365 x32
      i7-7700; GeForce GTX 1060; 16GB DDR4 2400; 2 x 256G SSD, 4TB HD

      1 user thanked author for this post.
      • #1010540 Reply

        JohnW
        AskWoody Plus

        ALL ships will go down with the tide in a panic. The strongest will recover more quickly. Best to be aboard one of them! 🙂

        • #1010844 Reply

          OscarCP
          AskWoody Plus

          JohnW: ” ALL ships will go down with the tide in a panic.

          True enough, but much depends on whether it is really a tide, that lowers all ships nicely together, or a chute down which fall the ships, one after another, ending up as a pile of wrecks at the bottom. (If anyone is wondering about it: nobody has ever accused me of being an optimist.)

          1 user thanked author for this post.

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