Microsoft manages to maintain growth despite Nokia purchase and multitude of changes

Microsoft today presented its financial results for the fourth and final quarter of fiscal year 2014 The timing was expected as it was the first after completing the acquisition of Nokia and for being a turning point after the changes recently announced by its CEO, Satya Nadella. The good news for those from Redmond is that they have managed to maintain the path of growth and close a year of changes with solid financial results.

In the quarter ending June 30, Microsoft achieved revenues of 23.382 million dollars, 18% more than in the same period last year. Profits also rose, although slightly less. The final figure for these three months is 6,482 million dollars in profit, 7% more than in the fourth quarter of fiscal year 2013. Although good, none of both are record numbers, with profits even lower than in the previous two quarters.

As almost always at Microsoft, growth compared to last year is sustained in business for companies and in the good numbers of some of the company's latest bets, such as Office 365 or Azure. The containment comes hand in hand with the device division acquired from Nokia, whose numbers are now beginning to affect the accounts of those from Redmond.

The acquisition of Nokia and the decline of Lumia

Microsoft completed the acquisition of Nokia's devices and services division on April 25, already immersed in the fourth quarter.It now integrates the new division of 'Phone Hardware' and it reflects the accounts of what are now Microsoft mobiles. In this last quarter, the contribution of the new mobile division was 1,990 million dollars in revenue, which translates into some loss of 692 million dollars

The numbers are not good for the new hardware now owned by Microsoft. The Lumia sales are estimated at 5.8 million units, numbers that, although they only represent two of the three months of the period, do seem to indicate a decrease in sales compared to the previous quarter. Likewise, sales of non-smartphone mobile devices remain at 30.3 million units.

These are numbers to be taken with caution. They neither represent the entire quarter nor are they indicative of practically nothing, especially taking into account the transition process in which the division was immersed.For now, the results for old Nokia devices are limited to putting a negative note on an otherwise meeting expectations quarter.

Growth in the rest of the divisions

In Redmond you can be happy with the results of all your major divisions. Those more oriented to the consumer market, encompassed under the name of 'Devices & Consumer', managed to increase their revenues by 42%compared to the same period last year, reaching 10 billion dollars. Windows Pro licences, which grew by 11%, subscriptions to Office 365, which already has 5.6 million users, and revenue from Bing, which increased by 40%; are primarily responsible for this growth.

But part of the previous division has been divided into two additional ones.One of them is that of 'Phone Hardware', which we have already seen as it registers the negative data of the device division acquired from Nokia. The other is called 'Computing and Gaming Hardware' The Surface department is made up of the latter, whose revenues have reached 409 million dollars; and Xbox, whose consoles have sold 1.1 million units during the last quarter.

In businesses aimed at companies, framed in the divisions 'Commercial Licensing' and 'Commercial Other', things continue to go from strength to strength. The income of both considered together grew this quarter, being responsible for 13,484 million dollars, 58% of the company's total income Good fault for this It has the business in the cloud, which continues to grow at an unstoppable rate, doubling its income compared to last year and reaching 4,400 million.The server sectors, including the Azure part, have also grown by 16%; consolidating this segment as Microsoft's strong point.

A good year at the expense of big changes

Fiscal year 2014 ends for Microsoft beating its annual numbers in both revenue and profit. The former rise to 86,833 million dollars, and the latter leave the bar at 27,760 million dollarsAll of this in a year of absolute transition for a company that for 6 months kept a retired CEO in command and modified its structure with the purchase of an entire mobile phone manufacturer such as Nokia.

What's coming now is a new era for Microsoft With the acquisition completed and with Satya Nadella already serving as true CEO, Redmond is months of changes ahead.They will not be easy, it is enough to see the reduction of 18 thousand jobs that are being prepared or the new limitations that are imposed from above, but they will probably be necessary.

In view of the results, few would point out the urgency of promoting radical changes in Microsoft, but the truth is that its position is still weak in some strategic and future sectors. That's why Nadella's proposal to steer the company toward a more focused version of itself seems right. The good closing of the fiscal year 2014 could not leave better bases to start.

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