Microsoft cloud flagship posts first growth under 50%; bookings growth steady
Microsoft Corp's <MSFT.O> flagship cloud computing business Azure reported quarterly sales growth of under 50% for the first time ever on Wednesday, sending the tech giant's shares down 2%.
Revenue in Microsoft's Intelligent Cloud segment rose 17% to $13.4 billion, with 47% growth in the Azure component, which includes essential computing and storage services. Analysts on average had expected cloud revenue of $13.09 billion in the fourth quarter ended June 30, according to IBES data from Refinitiv.
Azure's growth is the most direct measure of performance against top cloud rival Amazon.com Inc's <AMZN.O> Amazon Web Services, as Microsoft does not break out Azure's revenue by dollar amount. AWS posted revenue growth of 33% to $10.2 billion, which analysts believe exceeds Azure's total, for the quarter ended March 31. International Business Machines Corp <IBM.N>, another Microsoft rival, this week beat Wall Street expectations with strong cloud growth.
Beyond Azure, Microsoft's results showed how the novel coronavirus is both helping and hurting Microsoft.
German regulators twice looked into tightening the supervision of collapsed payments firm Wirecard and discussed it with the German and European central banks but no action was taken, a person with direct knowledge of the talks told Reuters.
Chinese tech giant Tencent is creating a "smart city" that utilises technology to put people and the environment first, a model that could be applied to other urban developments after the coronavirus, the project's architect said on Wednesday.
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