Analysis: Microsoft Post-Earnings Conference Call (Premium)

Microsoft has historically cherry-picked the data it chooses to share with the public at each earnings announcement, and this past quarter was no different. But the software giant also hosts a post-earnings conference call with analysts and press each quarter, and it usually reveals a bit more data during that call. Here’s what I learned and inferred from this quarter’s post-earnings conference call, which mostly consisted of “highlights” from Microsoft CEO and chairman Satya Nadella and CFO Amy Hood.

Nadella started off praising Microsoft Azure, which he described as a “distributed computing fabric---across the cloud and the edge---to help every organization build, run, and manage mission-critical workloads anywhere.” Analysts seem stuck on the fact that Azure---now a mature, 13-year-old offering---can no longer maintain its once-heady 70 percent growth rates. But Azure grew at 40 percent this past quarter and is the primary driver behind Microsoft’s biggest business, by far, Intelligent Cloud.

This growth is an astonishing achievement that Nadella credited to “leaders in every industry---from Blackrock, to Bridgestone, to Lufthansa--- all moving mission-critical workloads to Azure.” Azure is now the market leader for customers’ SAP workloads in the cloud, and Atos, Chevron, Fujitsu, and Woolworths all migrated their SAP applications to Azure in recent months, Nadella noted.

Given his background, it is perhaps not surprising that Nadella is fond of Microsoft’s AI- and developer-based offerings despite the fact that neither is a particularly strong money maker. But that’s fine because it means Nadella can open the kimono a bit and reveal details like the fact that Visual Studio, Microsoft’s integrated developer environment (IDE), now has over 31 million monthly active users, including most of the fortune 500. That’s a fascinating number when you consider that the latest figure that we have for .NET developers is just 6 million.

Nadella also noted that GitHub, the Microsoft code repository, is now used by 90 percent of the Fortune 100. And that its Power Platform surpassed $2 billion in revenues over the previous 12 months for the first time, up 72 percent. “Power Platform [is] one of our fastest-growing businesses, at scale,” Nadella said.

Nadella had fewer specifics for Microsoft Dynamics, which is part of its Productivity and Business Processes business and provides customer relations management functionality. Dynamics 365 is “growing faster than the business applications market overall,” which I assume means it’s growing share. But that was the only real data we got in the call. (In its press release, Microsoft noted that Dynamics products and cloud services revenues were up 22 percent in the quarter.

LinkedIn saw “record engagement” in the quarter, Nadella noted, with over 830 million professionals using the platform: this makes sense, given that many workers are using the pan...