Good business at Microsoft
Google’s advertising revenue is getting weaker and weaker
With Alphabet and Microsoft, two tech heavyweights presented their quarterly data after the US stock market closed. Only Microsoft can convince, especially thanks to a substantial plus in the cloud business. The Google parent, on the other hand, feels the reluctance of advertisers and fails to meet analysts’ expectations.
While Microsoft continued to benefit from the mobile work trend earlier this year, Google’s parent company Alphabet felt reluctance from advertisers in the midst of the global economic slowdown. In the first quarter, revenues increased 23% to approximately $ 68 billion, the world’s largest search engine provider announced. Profits, on the other hand, even dropped 8% to $ 16.4 billion. Analysts had raised the bar for both sales and profits. The stock fell more than four percent in after-hour trading, while the Microsoft newspaper rose slightly.
During the pandemic, Google benefited from the online boom and related advertising revenue. No other company in the world sells as many ads on the Internet as Google. However, competition from companies like Amazon and TikTok is growing. Furthermore, many advertisers currently prefer to keep their money together in order to be able to react more flexibly to concerns about inflation, delivery problems and the war in Ukraine. Google was also having a tougher time in the cloud industry than it was a year ago.
The cloud boom continues
Direct competitor Microsoft, on the other hand, pleased investors with an increase in cloud business – including the Azure offering – by 26%. Otherwise it went well. Microsoft’s sales increased 18% to nearly $ 49.4 billion in the last quarter to the end of March, as announced by the world’s largest software company in the United States. It’s more than analysts expected. Operating profit increased 19% to $ 20.4 billion.
Like Amazon and Google, Microsoft is benefiting from the fact that more and more employees, schoolchildren and students have moved flexibly between the home office and the office since the Crown crisis. For this to work, both businesses and individuals need cloud storage and applications that everyone can access from anywhere. Products and services often come from Microsoft, the home of Windows and Teams.
Microsoft is no longer active only in the software sector. The US group currently wants to take over the call-of-duty developer Activision Blizzard for 69 billion dollars and is therefore also betting on the metaverse that is being created, a virtual world accessible through various devices and platforms, destined to merge online and offline. More recently, Microsoft has had a lucky hand, such as with the acquisitions of LinkedIn or Skype.