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On August 22, 2024
4 Sources
[1]
Microsoft rejigs reporting on business units, offers clarity on AI benefits
Microsoft on Wednesday restructured how it reports results for its business units, moving some search and news advertising revenue under the Azure cloud-computing unit as the tech giant looks to offer investors a clearer picture on AI contributions. The company said revenue from the AI and speech technology services that its Nuance unit offers would now come under its productivity business - home to the Office suite of apps - instead of the intelligent cloud division. The rejig will allow Microsoft to align the reporting structure with how its businesses are managed, it said. As a result, the company restated revenue growth at its divisions for the last fiscal year and revised its forecast for July-September quarter. Big tech companies, including Microsoft and Google, are facing investor pressure to show that the billions of dollars they have been investing in AI infrastructure would pay off. Microsoft is one of the few big companies that break out AI contributions in their quarterly earnings, as most firms are yet to see a big boost from AI investments. The Windows maker reported last month AI provided a bigger boost to Azure in the June quarter, even as overall business slowed. Microsoft expects Azure's growth to accelerate in the second half of fiscal 2025. The company expects intelligent cloud revenue to be between $23.80 billion and $24.10 billion in the first quarter, compared with its prior expectations of $28.6 billion and $28.9 billion. Quarterly revenue at its personal computing segment is expected between $12.25 billion and $12.65 billion, compared with its earlier view of $14.9 billion and $15.3 billion, after the company moved some units from the business to the productivity division. Productivity and business processes revenue is expected to be between $27.75 billion and $28.05 billion, compared with $20.3 billion and $20.6 billion previously. (Reporting by Aditya Soni and Jaspreet Singh in Bengaluru; Editing by Arun Koyyur)
[2]
Microsoft rejigs reporting on business units, offers clarity on AI benefits
Microsoft said revenue from the AI and speech technology services that its Nuance unit offers would now come under its productivity business - home to the Office suite of apps - instead of the intelligent cloud division. The rejig will allow Microsoft to align the reporting structure with how its businesses are managed, it said.Microsoft on Wednesday restructured how it reports results for its business units, moving some search and news advertising revenue under the Azure cloud-computing unit as the tech giant looks to offer investors a clearer picture on AI contributions. The company said revenue from the AI and speech technology services that its Nuance unit offers would now come under its productivity business - home to the Office suite of apps - instead of the intelligent cloud division. The rejig will allow Microsoft to align the reporting structure with how its businesses are managed, it said. As a result, the company restated revenue growth at its divisions for the last fiscal year and revised its forecast for July-September quarter. Big tech companies, including Microsoft and Google, are facing investor pressure to show that the billions of dollars they have been investing in AI infrastructure would pay off. Microsoft is one of the few big companies that break out AI contributions in their quarterly earnings, as most firms are yet to see a big boost from AI investments. The Windows maker reported last month AI provided a bigger boost to Azure in the June quarter, even as overall business slowed. Microsoft expects Azure's growth to accelerate in the second half of fiscal 2025. The company expects intelligent cloud revenue to be between $23.80 billion and $24.10 billion in the first quarter, compared with its prior expectations of $28.6 billion and $28.9 billion. Quarterly revenue at its personal computing segment is expected between $12.25 billion and $12.65 billion, compared with its earlier view of $14.9 billion and $15.3 billion, after the company moved some units from the business to the productivity division. Productivity and business processes revenue is expected to be between $27.75 billion and $28.05 billion, compared with $20.3 billion and $20.6 billion previously.
[3]
Microsoft revamps reporting on business units, offers clarity on AI benefits
Microsoft on Wednesday restructured how it reports results for its business units, moving some search and news advertising revenue under the Azure cloud-computing unit as the tech giant looks to offer investors a clearer picture on AI contributions. The company said it was also moving revenue from the AI and speech technology services Nuance to its productivity business, which is home to the Office suite of apps, including Word and PowerPoint. The changes led to a restatement of revenue growth at these divisions for the last fiscal year and a revision to its forecast for September quarter. The rejig comes as big tech companies, including Microsoft, face investor pressure to show that the billions of dollars they have been investing in AI would pay off. Microsoft 365 anti-phishing measures can be bypassed, finds study Unravel the complexities of our digital world on The Interface podcast, where business leaders and scientists share insights that shape tomorrow's innovation. The Interface is also available on YouTube, Apple Podcasts and Spotify.) The company reported slowing growth in its cloud business in July, but had said it would accelerate in the second half of fiscal 2025. The company now expects intelligent cloud revenue to be between $23.80 billion and $24.10 billion, compared with its prior expectations of $28.6 billion and $28.9 billion. Microsoft also cut quarterly forecast for its more personal computing segment to between $12.25 billion and $12.65, compared with its earlier expectation of $14.9 billion and $15.3 billion. However, it raised productivity and business processes outlook to between $27.75 billion and $28.05 billion, compared with $20.3 billion and $20.6 billion. Read Comments
[4]
Microsoft rejigs reporting on business units, offers clarity on AI benefits
(Reuters) -Microsoft on Wednesday restructured how it reports results for its business units, moving some search and news advertising revenue under the Azure cloud-computing unit as the tech giant looks to offer investors a clearer picture on AI contributions. The company said it was also moving revenue from the AI and speech technology services Nuance to its productivity business, which is home to the Office suite of apps, including Word and PowerPoint.
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Microsoft announces changes to its financial reporting structure, aiming to provide greater clarity on the impact of artificial intelligence across its business units. The tech giant's move reflects the growing importance of AI in its operations and strategy.
Microsoft, the tech giant known for its software and cloud services, has announced a significant change in its financial reporting structure. This move is designed to offer investors and analysts a clearer picture of how artificial intelligence (AI) is benefiting various segments of its business 1.
The company will now report its financial results under three main categories:
This restructuring aims to better reflect the integration of AI across Microsoft's product lines and services 2.
Microsoft has been aggressively incorporating AI into its products and services, particularly through its partnership with OpenAI. The company's AI-powered Copilot assistants have been integrated into various offerings, including its Office productivity suite and cloud services 3.
The new reporting structure will provide more granular details on the financial impact of AI across different business segments. This change is expected to help investors better understand how AI is driving growth and profitability within the company 4.
Analysts and investors have welcomed this move, as it promises to offer greater transparency into Microsoft's AI-driven initiatives. The tech industry is closely watching how AI investments translate into tangible financial benefits, and Microsoft's new reporting structure could set a precedent for other companies in the sector 2.
As Microsoft continues to invest heavily in AI technology, this reporting change signals the company's confidence in the growing importance of AI to its overall business strategy. The move is likely to influence how other tech companies report on their AI initiatives and could reshape investor expectations across the industry 1.
Reference
Microsoft announces changes to its financial reporting structure, emphasizing cloud consumption metrics and reorganizing key business segments. The move aims to provide investors with greater visibility into the company's cloud business performance.
2 Sources
Microsoft's Azure cloud service experiences a growth deceleration, causing investor unease. The tech giant's AI investments and future outlook remain in focus as the company navigates changing market dynamics.
15 Sources
Microsoft's Azure AI receives a significant boost with the integration of OpenAI models, despite a slight miss in Q2 earnings. The company remains optimistic about its AI-driven future.
2 Sources
Microsoft's Q4 2023 earnings report sparks debate on Wall Street. While AI investments remain strong, Azure's growth slowdown and high valuation raise concerns among investors and analysts.
12 Sources
Microsoft CEO Satya Nadella's "learn-it-all" culture and strategic AI investments have propelled the company to new heights, reaching a $3 trillion market valuation and positioning it as a leader in the AI revolution.
2 Sources