Tip of the Hat to Satya Nadella: Microsoft Commercial Q2 Success Led by System Center, Cloud, and Office 365

Tip of the Hat to Satya Nadella: Microsoft Commercial Q2 Success Led by System Center, Cloud, and Office 365

With the details call still to happen a little later, Microsoft has officially released the earnings report for Fiscal Year 2014, Quarter 2. And, the numbers are good. Real good.

While there were some negatives, such as a decline in Windows OEM revenue, there were many positives in areas Microsoft was most hopeful, most notably the Surface and Xbox One. Yes, I did elude to Surface success. Surface revenue doubled!

To hear more about the overall details, read through Paul's summation here: Microsoft Reports Record Quarterly Revenues of $24.52 Billion

Microsoft lumps Devices and Consumers into a single category and Commercial (or business) into a category of its own. It's surprising that the Surface Pro and Surface Pro 2 sit under the consumer area, considering Microsoft promotes those specific models as business tools. However, the Commercial business includes those areas specific to IT Pros. Things like SQL Server, System Center, Cloud (private, hybrid, and public), Office 365, and Azure.

SQL Server, System Center and Microsoft's Commercial Cloud services all saw double-digit revenue growth. Interesting though, is that Office 365 and Windows Azure are being reckoned by the number of seats instead of revenue. Both Office 365 and Windows Azure saw a triple-digit increase in customers. How that relates to overall revenue, we'll have to see.

Related: SQL Server Revenue Grew by Double-Digits in FY14 Q2

Also of note is that Hyper-V gained 5 points of share.

But, I think more interesting than the reported growth is the additional feedback on the growth that Kevin Turner, chief operating officer, included. Kevin was keen to highlight that Microsoft has seen more than 100% revenue growth year-over-year in commercial cloud services (which includes System Center)

Microsoft will announce a new CEO soon and if rumors are true, the announcement and launch could come around the March 2014 time frame. One of the remaining candidates is an internal hopeful, Satya Nadella, executive vice president of Microsoft's Cloud and Enterprise group.

Satya's Microsoft glory page is here: Satya Nadella, Executive Vice President, Cloud and Enterprise

(Not quite as cool as Brad Anderson's glory page btw: Brad Anderson)

I've been saying all along (go ahead, go back and search the site) that Satya would make a perfect candidate. He's been the leader of a very important and very successful area at Microsoft that has been the basis for the company's perceived way forward for several years.

If Microsoft decides to use their fantastic earnings report to launch a new CEO, I believe the market could be sold on Satya as the front runner, based on his continued success in Microsoft's commercial space. Obviously, Satya knows how to run a successful business, and he has his finger on the pulse of Microsoft's focus and direction.

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