Microsoft Corporation (MSFT)

Sector: Technology|Industry: Software - Infrastructure|Market Cap: $3.20T|Employees: 228K


Microsoft is a leading technology company that develops and supports a wide range of software, services, devices, and solutions, empowering individuals and businesses to reach their full potential. Its primary revenue streams include cloud-based solutions (Azure), productivity and collaboration software (Microsoft 365, Dynamics 365), and personal computing (Windows).

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  2. Company Profile

Business Summary

Microsoft is a technology company with a mission to empower every person and every organization on the planet to achieve more. They develop and support software, services, devices, and solutions that deliver value for customers. Microsoft creates platforms and tools powered by AI that offer innovative solutions. They strive to create local opportunity, growth, and impact globally.

Competitive Advantages: Microsoft benefits from economies of scale with its data centers, coordinating diverse customer needs and application demand patterns, and multi-tenancy locations that lower costs. They provide hybrid consistency, developer productivity, data and AI capabilities, and trusted security and compliance.

Key Markets and Geographic Presence: Microsoft operates globally, with a significant presence in the U.S. and internationally.

Competitive Landscape: Microsoft faces competition from various companies in different sectors, including Apple, Cisco Systems, Google, Meta, Proofpoint, Slack, Symantec, Zoom, Amazon, Broadcom, IBM, Oracle, Salesforce, SAP, ServiceNow, UI Path, WorkDay, Databricks, Snowflake, Nintendo, and Sony.

Key Statistics

  • Employees: 228,000 (as of June 30, 2024)
  • Geographic Footprint: Operates in multiple countries globally
  • Headquarters: Redmond, Washington
  • Founded: 1975
  • Number of locations/facilities: Not specified, but includes data centers and offices globally
  • Revenue: $245.12 billion (FY2024)
  • Market Cap: $2.8 trillion (as of December 31, 2023)
  • Key Subsidiaries/Brands: Activision Blizzard, Nuance, LinkedIn, GitHub, Xbox, Surface, Windows, Office, Azure, Dynamics 365

Leadership

  • CEO: Satya Nadella (Chairman and CEO)
  • CFO: Amy E. Hood
  • Board Chair: Satya Nadella
  • Other Key Executives: Judson B. Althoff (Chief Commercial Officer), Kathleen T. Hogan (Chief Human Resources Officer), Takeshi Numoto (Chief Marketing Officer), Bradford L. Smith (Vice Chair and President), Christopher D. Young (Executive Vice President, Business Development, Strategy, and Ventures)

Key Financial Metrics

  • Annual Revenue: $245.1 billion (FY2024)
  • Net Income: $88.1 billion (FY2024)
  • Market Cap: $2.8 trillion (as of December 31, 2023)
  • Total Assets: $512.2 billion (FY2024)
  • Number of Employees: 228,000 (as of June 30, 2024)
  • Key Financial Highlights: Revenue increased 16% YoY, driven by growth across all segments. Microsoft Cloud revenue increased 23% to $137.4 billion.

Products and Services

Microsoft offers a wide range of products and services across various categories:

  • Operating Systems: Windows 11 and Windows IoT
  • Productivity and Collaboration Software: Microsoft 365, Office Suite (Word, Excel, PowerPoint, etc.), Microsoft Teams, Microsoft Viva
  • Cloud Services: Azure, Microsoft 365, Dynamics 365, GitHub, Xbox Cloud Gaming
  • Server Applications: SQL Server, Windows Server, Visual Studio, System Center
  • Business Solutions: Dynamics 365 (ERP, CRM, supply chain management)
  • Hardware: Surface devices (PCs, laptops, tablets), Xbox consoles, HoloLens, PC accessories
  • Gaming: Xbox Game Pass, video games (Activision Blizzard)
  • Search and Advertising: Bing search engine, Microsoft Advertising
  • Professional Networking: LinkedIn

Key Business Segments

Microsoft operates through three reportable segments:

  • Productivity and Business Processes: Includes Office Commercial, Office Consumer, LinkedIn, and Dynamics 365. Revenue: $77.7 billion (FY2024)
  • Intelligent Cloud: Includes server products and cloud services (Azure, SQL Server, Windows Server) and enterprise services. Revenue: $105.4 billion (FY2024)
  • More Personal Computing: Includes Windows, Devices, Gaming, and Search and news advertising. Revenue: $62 billion (FY2024)

Business Strategy

Microsoft's strategic priorities revolve around three interconnected ambitions:

  • Reinvent productivity and business processes: Focus on enhancing productivity and collaboration tools, including Microsoft 365, LinkedIn, and Dynamics 365, leveraging AI and cloud technologies.
  • Build the intelligent cloud and intelligent edge platform: Continued investment in high-performance and sustainable computing infrastructure to support cloud services and AI transformation, with Azure as the foundation.
  • Create more personal computing: Focus on making computing more personal and intuitive through innovations in Windows 11, Surface devices, and gaming experiences.

Growth Strategies: Microsoft aims to lead in various technology areas, including transforming the workplace, building cloud-based services, applying AI and ambient intelligence, enhancing security solutions, inventing new gaming experiences, and expanding the use of Windows.

Innovation and Future Outlook: Microsoft is committed to investing in emerging technologies, such as AI, quantum computing, and gaming, to drive future growth and innovation.

Industry Context

Microsoft operates in the technology industry, specifically in software, cloud computing, hardware, gaming, and advertising. The industry is highly competitive and dynamic, with frequent changes in technologies and business models.

Key Market Trends: Digital transformation, AI adoption, and increasing cyber threats are major trends affecting the business.

Risk Factors

  • Intense Competition: Microsoft faces competition from various companies across all market segments, which could impact market share and profitability.
  • Cybersecurity Threats: Increasingly sophisticated cyberattacks and security vulnerabilities could lead to data breaches, financial losses, and reputational damage.
  • Dependence on Partners and Ecosystem: Microsoft's business relies on a network of partners and a robust ecosystem, which can be affected by external factors like economic downturns.
  • Regulatory Scrutiny: Government enforcement under competition laws and new market regulations could limit how Microsoft designs and markets its products.
  • Investment Risks: Significant investments in new technologies and acquisitions may not achieve expected returns.

(Generated from latest 10-K filing)