Former Microsoft boss thinks Microsoft needs more transparency in disclosing Azure financial results
Former Microsoft CEO Steve Ballmer has lambasted Microsoft for failing to disclose its profit margins and sales for its cloud business.
Speaking to Bloomberg, Ballmer, who headed up Microsoft from 2000 to 2014, said: “It’s sort of a key metric, if they talk about it as key to the company, they should report it.”
Instead, Microsoft chooses to report an annual revenue run rate for its Azure cloud business, and says it wants to reach sales of $20 billion (£13.4bn) by 2018. This, according to Ballmer, is “bullshit”.
It was April when Microsoft said it would end the current financial year with a gross margin of 44 percent for its commercial cloud business. But the company chooses not to disclose a total sales figure for the division.
Ballmer, who is Microsoft’s single largest shareholder, also suggested that Nadella needs to allow Android apps to work on Windows Phones if the platform is to see any kind of success.
As of October 22, Microsoft changed its fiscal reporting structure to reveal its earnings in three distinct divisions that, according to the company, show the importance of Windows 10 and give transparency to Azure cloud
Starting from the beginning of its new financial year, Microsoft reported revenue, loss, and operating income in three portions: Productivity and Business Processes, Intelligent Cloud and More Personal Computing.
In a statement, Microsoft said the change of the reporting structure reflects the company’s “strategy and ambitions to build best-in-class platforms and productivity services for a mobile-first, cloud-first world”.
The new titles are lifted straight from CEO Satya Nadella’s own company wide emails, where he outlined his future visions for Microsoft. Specifically, the titles refer to Nadella wanting to “reinvent productivity and business processes”, “build the intelligent cloud platform”, and “create more personal computing”.
In October, Microsoft posted a 12 percent year-over-year decline in revenues, down to $20.38 billion (£13.65bn). Commercial cloud annual revenue run rate exceeded $8.2 billion (£5.49bn). Adoption of Azure and its associated cloud services also grew 135 percent in revenues, said Microsoft.