Ever since Satya Nadella has donned the cap of the CEO at Microsoft (MSFT) tables have turned in the tech-giant’s favor. Things seem to be shaping up for a very bright Fiscal 2014. When things have not gone well in MSFT’s favor for past few days, things have now started to change. As much as quality and care of design language is natural to Apple (AAPL), the ability to persist through growing pains and breakthrough to profitability is natural to Microsoft. Experts are of the view that Nadella is probably the best thing to have happened to MSFT so far. This is so because of his long innings with the company. His experience as the company’s vice president of the company’s Cloud and Enterprise group will definitely come in handy in his stint as the CEO.
The Cloud Services revenue for the company grew by an astounding $315million or 107%. This is owed to the hugely successful Commercial Office 365 which yielded higher revenues. One more thing to look forward too is the launch of Office for iPad. This has clear sent clear indications that the revenues for Microsoft's Devices & Consumer Licensing division can grow revenues and profit year-over-year. During FY2014 Q2, Office revenue declined $244 million or 24%, reflecting the transition of customers to Office 365 Home Premium as well as continued softness in the consumer PC market. The iPad’s is a growing market with oodles of revenue. This therefore more than makes up for the softening markets for the now unwanted PCs. For the record, in the fiscal quarter that ended on December 28, 2013 Apple sold 26 million iPads. There lies gold for MSFT. Making use of this ever increasing market cap of the iPads, MSFT can hit a jackpot. What is even more impressive is that Microsoft managed to get into the iPad market first before Google introduced its own suite of enterprise focused offerings.
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Microsoft’s latest strategy seems to be striking deals with fast growing Indian mobile phone makers. A rumored deal with Micromax is currently doing the rounds. This, the company thinks will save them more cash rather than upgrading their Windows Phone.
The company has also decided to go ahead with the launch of its much awaited Xbox One that comes with the “Titan Fall”. This is company’s latest strategy to capture the advanced gaming market where Sony’s PS4 is ruling the scene. This is why the company has decided to price it at par with PS4. This was evident when Microsoft cut the prices to its Titan Fall XBox One bundle to $449 in its Microsoft stores and other retailers. This boosted sales of Xbox One by 96% over a week in the UK.
With Satya Nadella at the helm, there’d be no stopping Microsoft. Satya’s efficient policies to channelize Microsoft’s huge resources will drive it past many a top performing companies. A couple of deals with fast growing Indian OEMs and the deal with Apple for an Office Suite for iPads are surely going to bolster the growth in revenues. The investor’s can put their money in MSFT stocks as it looks to be the safest now.