Microsoft

Microsoft (NASDAQ:MSFT) is a technology corporation known for being the largest global vendor of computer software (including the Windows operating system and the Microsoft Office suite). It is also a leading provider of cloud computing services, video games, computer and gaming hardware, search, and other online services. Microsoft is one of the largest listed companies worldwide and one of the Big Five tech firms (GAMAM) , reporting USD 198 billion in annual revenue in FY 2022.  

Originally founded in 1975, Microsoft made its initial public offering in 1986. Over the years, the company underwent several restructuring attempts in a bid to unify disparate business units. It did this by either coalescing divisional strategies under a single strategy (“One Microsoft” in 2013), streamlining and aligning acquisitions to the company’s strategy (post-Nokia acquisition in 2014), or integrating its Sales, Marketing, and Services Group (SMSG) into the rest of the company to form one senior leadership team (2016). In July 2022, Microsoft announced the retrenchment of just under 1% of its ~180,000 workforce as part of a strategic realignment of business groups and roles, impacting teams like customer and partner solutions as well as consulting. Notably, in January 2022, Microsoft entered a USD 68.7 billion agreement (the largest to date) to acquire Activision Blizzard, a frontrunner in game development and interactive content publishing. In June 2022, Microsoft reached USD 2 trillion in market capitalization for the first time, just two years after it first passed the USD 1 trillion milestone. In 2022, the company also topped Fortune’s inaugural Modern Board 25 for the most innovative board of directors in the S&P 500, achieving high scores in gender equality; board independence; board expertise; and environmental, social, and governance (ESG) metrics. 

Microsoft operates across three broad reporting segments: productivity and business processes, intelligent cloud, and more personal computing. Each segment accounts for roughly a third of Microsoft’s revenue mix, with intelligent cloud in the lead at ~38% (2022). Microsoft’s server products and cloud services portfolio (a subsegment of intelligent cloud) represents the biggest revenue earner at ~USD 67 billion (2022), followed by Office products and cloud services (subsegment of productivity and business processes) at ~USD 45 billion (2022).

In 2022, the US represented ~51% of Microsoft’s total revenue and constituted the company’s single largest market, with no other individual customer or country accounting for over 10% of revenue (2020–22). Microsoft has planned significant investments around modular business applications that transform workplaces; cloud-based services that create new experiences for businesses and individuals; and using Windows as a means of growing its cloud business, its share of the PC market, and driving engagement with other services. It also planned to leverage AI applications to drive insights and understand customer needs, develop end-to-end security solutions across all clouds and platforms, and make innovative advances in console and PC gaming.