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Cloud sales stoke Microsoft’s strong growth

Microsoft says cloud-based Office products made a huge contribution to sales growth

Microsoft sales increased by 17% in the final quarter of its current financial year, with cloud sales driving growth.

The software giant reported total sales exceeding $100bn for the full year.

Sales for the three-month period to 30 June 2018 reached $30bn, compared with $25.6bn for the same period last year.

Sales of Microsoft Office to businesses increased by 10%, with its cloud-based Office 365 fuelling this growth with a 38% increase in sales.

The company made an $8.7bn profit in the quarter.

CEO Satya Nadella said Microsoft had benefited from its investment in cloud delivery.

“Our early investments in the intelligent cloud and intelligent edge are paying off, and we will continue to expand our reach in large and growing markets with differentiated innovation,” he said.

In the consumer market, sales of office products and cloud services increased by 8%, with 31.4 million consumers now subscribing to Office 365.

Other highlights saw LinkedIn, the business social network that Microsoft acquired for $26bn in 2016, increase sales by 37%, and its cloud-based ERP Dynamics 365 offering saw a 61% increase in sales.

When Microsoft acquired LinkedIn, Nadella stressed how the social network would complement its Dynamics and Office products. “Along with the new growth in our Office 365 commercial and Dynamics businesses, this deal is key to our bold ambition to re-invent productivity and business processes,” he said.

Tom Taulli, an analyst at InvestorPlace.com, told Reuters that Microsoft had the right blend of technology and delivery.

“The combination of the cloud, which is a megatrend that’s going to last for years to come, and the execution, this is a company that knows how to sell and be innovative. It’s hard to argue with anything here,” he said.

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