Microsoft reported revenue of $36.9 billion in the second quarter of fiscal 2020, up 14 percent from a year earlier, and in its earnings report, the company repeatedly praised the performance of its cloud products and said revenue from the commercial cloud rose no less than 39 percent. But a closer look at the data shared by Microsoft in its earnings reports reveals that Windows has once again become the redmond-based software giant’s money-making machine, generating $13.2 billion in revenue from its personal computing division alone.
That’s more than the $11.9 billion Intelligent Cloud division that generated revenue and $11.8 billion in the productivity and business processes division.
While more personal computing revenue grew by only 2%, Windows OEM revenue grew by no less than 18%, and Windows business products and cloud services achieved similar growth, with revenue up 25% in the quarter.
There are a number of reasons for the increase in Windows revenue, including Windows 7 termination support, we know that Windows 7 will no longer receive updates since January 14, and Microsoft has been advising customers to upgrade to Windows 10.
Amy Hood, Microsoft’s executive vice president and chief financial officer, said demand for Windows 10 was strong this quarter.
“The overall PC market grew stronger than we expected and benefited from a year before the year before the low comparability of chip supply times with OEM partners. OEM Pro revenue accounts for about 40 percent of Windows revenue, up 26 percent, driven by continued growth prior to Windows 7’s end of support and strong Demand for Windows 10. Comparable low earnings over the same period last year resulted in an increase of about 11 percent,” she said on a conference call with analysts after the earnings release.
Microsoft said “health demand” had kept Windows performing strongly in the next quarter, thanks to the end of support for Windows 7.