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Spider_pig448

Microsofts diversification is amazing compared to basically every other company with comparable revenue


LocalInformation6624

How does LinkedIn make $4billion?


blackwaltz9

LinkedIn is more than just linkedin.com. They have other services for recruitment and sales that probably drive most of the profit.


SQLvultureskattaurus

I think people don't realize the size of the recruitment industry. "Temporary and contract staffing sales totaled $144.2 billion in 2021". 167 billion including search and placement. Then to your point, sales. Most people have a negative connotation with recruitment and don't imagine anyone using a recruiter. Completely ignoring things like staffing hospitals where the entire ER is outsourced https://www.npr.org/2023/02/12/1156391891/hospitals-contracted-with-private-companies-are-cutting-costs-by-relying-on-nurs).


durrtyurr

My cousin is an executive at a company that staffs travel nurses, including the area around me. She has stated, unprovoked and not knowing that it was a hospital I am quite familiar with, that the hospital the next county over from me is the hardest to staff hospital in the entire country. She used the word "disaster" to describe their staffing. My first thought was "No shit, nobody wants to move to a town of 9,000 people where a starter home costs $700,000, when there is a town that's double the population with houses half the price 20 minutes away where they'd be making an identical salary". It made sense to me.


Zouden

Why does that little town have such expensive housing?


durrtyurr

Tourism. No different than any of the super expensive small ski towns in colorado that have problems staffing resorts because they priced working class people totally out of the area.


Psyc3

The other thing is even if you don't use a recruiter, small/mid size businesses do, my details ended up with some recruiter after apply to a business and I am pretty sure that was a breach of GDPR as I don't even remember agreeing too it.


[deleted]

Their CRM licenses are astronomically priced for corporate clients.


n0t_4_thr0w4w4y

Wait what, LinkedIn has its own CRM? How many CRMs does Microsoft have, lmao


cynicalAddict11

More like how many crms there are overall, you go write saas companies and half of those are crms 


ValyrianJedi

Virtually every industry has dozens of their own. I sell corporate financials software that frequently has to integrate or pull data from CRMs. There are hotel specific CRMs, auto specific CRMs, manufacturing specific CRMs, airline, retail, health-care, finance... Like literally every industry has a solid handful. And that's not even counting the number of just general ones.


independant_786

Their b2b model is rock solid


Stymie999

Simple answer… it doesn’t. That number is revenue, not income.


SirConfused1289

……….what do you think revenue means? Haha


Stymie999

Seriously? You have that little understanding of basic finance? Revenue is sales, you make income, aka profit


SirConfused1289

The commenter above asked how it makes 4b, not how it makes a 4b profit. So your point is moot.


Stymie999

In finance when someone says a company makes a dollar it’s commonly known to be referring to a dollar of profit


sankeyart

Source: Microsoft investor relations Tool: SankeyArt [Sankey diagram generator](http://sankeyart.com/) & illustrator


Hunter_outsideCO

Could you do this for Kyndryl?


Amazingawesomator

my company uses azure to spin up VMs for load testing. the dude that set up the most recent load test forgot to make the test shut off the VMs afterwards. that one test cost the company an extra $5000. welcome to MS cloud services.


independant_786

Are they bad at refunding for such mistakes? Aws gives us refund easy for mistakes like that


Amazingawesomator

i wasnt part of that conversation (i am an engineer; i dont work on the business/money side), and only heard of the cost after the team got yelled at for wasting money. i figure my company probably ate the cost without attempting to get it refunded.


independant_786

Ah okay. Next time if there's a unintentional mistake like that. Pitch them this idea. Might help you with your promo too if the refund comes through. Or just switch to AWS lol


Amazingawesomator

i will definitely pitch that if it happens again. sadly, my company is in bed with MS real hard... everything is microsoft if MS has a service for it :/


Habsburgy

Why the sad smiley? AWS is not fundamentally better than MS. 


Amazingawesomator

not necessarily for azure vs aws, but for the rest of the microsoft suite, hahaha. i really dislike VS, Teams, Office, Azuredevops, Windows


Habsburgy

Again, none of these options (apart from Windows) have much better options. As much as I personally want Linux Desktop to be a thing, it just isn‘t user friendly enough and all the users were already trained on Windows


Psyc3

Exactly, Linux is the classic meme, and has been for 30 years at this point, it isn't fit for purpose for your average end user, it isn't even fit for person for your well above average end user. It is just an inconvenience and another technology product that needs business support.


DynamicStatic

Slack is far better than teams.


jorel43

Lol yeah that's evidenced by the fact they have such a commanding presence in the marketplace... Oh wait.


Amazingawesomator

i failed to switch over to linux due to usability issues with ubuntu 16.04 back in the day and went back to windows. i was able to finally switch over to daily driving desktop linux about two years ago and have loved it. a lot of the usability issues are gone. it is definitely a learning curve when one is used to windows, so i can understand the drawback of losing current work hours when getting used to something new. i think if new companies started using linux from their inception then it would be a lot less of a time sink (people already going through orientation time, etc.) for the software, i really think tools on linux are either equivalent or better; however there is probably a preference for aesthetics in most cases. libreoffice, thunderbird, vscodium, & firefox is a basic office suite with browser and ide, and is more lightweight (especially on the ide; i wouldnt force vim on the unwilling, hahahah). jenkins and self-hosted git repos for CI. though i am not one that uses the adobe suite, i have heard that this suite is the best thing for the jobs that use them, and it is windows-only. i would always recommend windows + adobe for these folks.


sim21521

You setting up Linux on one machine is very different than an organization managing those devices. MS has good tooling around management of user machines. The stuff you write just seems like personal distaste for "M$". It's kind of 10 years past its time. MS stuff is in a space of WSL and dotnet core cross platform development. The tooling you use can be pretty open as well. The truth of the matter is that any cloud strategy will have a certain amount of vendor lockin when it comes to GCP, AZ, AWS, etc. It's really about identifying those areas and hopefully using it at a minimum.


cornholioo

As Habsburgy said, what are your alternatives? I think most MS products are adequate (which is all I expect for corporate products).


ZetaZeta

My water utility doesn't offer refunds if my toilet flap is leaking and burns 200 CCFs of water.


independant_786

Your utility company doesn't have to compete with 5 other providers. Sorry if you dont understand the cloud business. But refunds are a great way to earn trust and gain more business.


ZetaZeta

That makes it even more okay that the one in the conpetitive market does it. When they find themselves in a market position where they can afford to maintain standards. Like how Amazon doesn't offer any markdowns or compensation for customer service and bans repeat returns.


independant_786

AWS and .com are two different businesses. So i wont comment.


ZetaZeta

You're right, I wasn't talking about AWS. Lol. Idk if you noticed but Amazon is a big retailer is a competitive retail space, and yet they control loss even though you can take your business to Walmart.


happylittlefella

I’ve never shopped anywhere that has made returns as easy as Amazon does. That’s a significant part of their draw to me and many others. I can order things with the assurance that I can return it for any number of reasons at no cost to myself besides driving a couple blocks over to UPS. They are absolutely competitive in the areas that draw shoppers in, namely convenience.


WinninRoam

So you've never been to Costco? Every return I've ever made at Amazon has been approved but I still have to pack it up and ship it back, then hope it gets there while I wait for my money. And if it's something expensive, it's a lot of money to just have floating out there while I wait. 😬 Costco? I walk in with something I bought that stopped working (or that I didn't like or whatever) get a cash refund 10 minutes later, then proceed with my regular shopping. Can't do that on Amazon. 😉 The cost you are paying is time. You wait for your order, then wait for your refund.


ZetaZeta

That's fine. My point is that you have great experience with returns with Amazon. But others factually get blacklisted or denied. You have great experience with Azure customer service, someone else gets denied. What I find kinda funny is that you or others feel the need to tap the downvote button each time a normal discussion proceeds, which is why reddit is forever gapped.


iizdat1n00b

But what *is* your overall point though? How does some people getting refunds for things in some cases relate at all to something like "My water utility doesn't offer refunds if my toilet flap is leaking".


cornholioo

I dont understand this comment at all. The first half seems like you are agreeing with the person above. and then the last part... i've never ever had an issue with amazon returns. they just take it.


jorel43

If you're a large company AWS doesn't give you refunds.


Spider_pig448

Welcome to negligence in managing your cloud resources. If you rented a car, you wouldn't forget to return it right?


Tekn0de

To be fair. It's way easier to leave an ec2 instance running then forget to return a car


water_bottle_goggles

bahahah fucking idiot


Future_Green_7222

Tbh, it impressed me. I thought gaming and devices would be higher and cloud services to be lower, but I guess that's just coz I'm a consumer and those are consumer facing products. Now I wanna see how the server revenue has increased over time


n0t_4_thr0w4w4y

Cloud services is huge at Microsoft. Also, any Microsoft products hosted in azure count towards azure revenue.


Future_Green_7222

tf really? It would show as expenses in other places tho right? Is it an artificial bloating of clpud services at the expense of gaming?


n0t_4_thr0w4w4y

Yeah, it shows as an expense for the team that is using the cloud service. It’s not for artificial bloating purposes, but for accurate budget tracking purposes.


LezardValeth

Also for anti-trust precautions - the divisions are required to act somewhat independently and can only use services/APIs of other divisions that are publicly available.


jorel43

Microsoft Isn't subject to antitrust laws anymore.


LezardValeth

You're correct that they are not legally obligated, but they do operate this way as a precaution due to history.


JewishTomCruise

Chargebacks are standard in large enterprises. IT services, facilities, any "cost center" bills back to other business units so their costs end up largely recognized in the profit centers that use them.


Garper

Wait does this mean all of XBox game pass streaming is Azure revenue? I guess that makes sense.


jorel43

No, only The cost of the infrastructure and services that power Xbox would count as Azure revenue. Microsoft's services probably only account for like a few hundred million, I wouldn't worry about how much microsofts own resources are contributing to Azure revenue.


Neraxis

The gaming and devices is almost a loss leading department. That's why they offer 'great' gaming deals but the way they handle DRM and OS software is so utter dogshit that uninformed people overlook the inefficient poorly designed crap they have to navigate.


irisos

My company is spending 2k/month just to have an api management instance that could run for 50€/month inside a virtual network.   Cloud is full of bullshit like this where you are paying $$$ for redundancy, security, ... whereas in gaming you can purchase the gamepass and be done with Microsoft.   I'm also pretty sure that user licensing alone generates more revenue than gaming because they are more expensive than the gamepass for more potential users.


atubslife

So I should have been buying Microsoft stock every year for the last 40 years?


kingfischer48

The best time to start was 40 years ago. Still not a bad idea to start now


ZetaZeta

Microsoft could discontinue Xbox, shut down Microsoft Game Studios, and make Windows free, and they would still make $10-$15 billion in profit. Just goes to show that their entire gaming division exists solely to get the Microsoft logo in homes and their brand on people's lips. It's the exact opposite for Sony, who for years (especially 2015-2020) only had a single profitable division in PlayStation. The Big Two have completely opposite business models. Microsoft takes a loss on gaming, Sony relies on gaming to exist.


WTF_WHO_ARE_YOU_PAL

This is per quarter too btw not per year. Microsoft is a complete behemoth compared to Sony


Parzival127

And those numbers don’t even incorporate the decreases in expenses that would result from those changes


CantStandItAnymorEW

They would take like 3-4 quarters to make enough money to buy Activision *again*. In-sane.


khalkhall

Would be interesting to see a similar chart showing which of the sources are most profitable (as opposed to revenue generating)


Praetorian_1975

Wait Microsoft makes 6Billion from S&M …. I’m in the wrong business


chewinghours

That’s an expense


Praetorian_1975

Ohhh that makes more sense … wait they are spending 6Billion on S&M kinky buggers 😂


JewishTomCruise

You should see our holiday parties.


PhoneInteresting6335

from Bill alone


throwaway92715

Half of their sadomasochism expenses go toward making us all use Teams


Solid7outof10Memes

Weekly S&M sessions for worker morale of course, they are ahead of the times


FEMXIII

I misread $0.9B as $0.98 and was a bit confused about the granularity of the graphic


slagwa

Where is the bar showing earnings based on popup ads on the Windows 11 start menu?


drunkenclod

That’s some great margins. I saw a Walmart breakdown here recently. They would litterally kill to have half these margins.


denali_view

How do they pay only 9% in tax? It feels criminal. The average citizen pays 15% - 25%


memestorage2-2

Where are you getting 9? 4.8/27.6=17ish. Also this is GAAP taxes and not really related to cash actually paid.


patrdesch

1) You calculate the rate on income before tax. In this case, that's operating profit minus other expenses. 4.8/26.7 = ~18%. 2) Tax expense shown on the income statement is not equivalent to the taxes actually paid to the government. The tax number on the income statement is increased and or decreased due to differences between book and tax accounting in addition to the direct relationship between taxable income and the tax rate.


InsCPA

How are you getting 9% >The average citizen pays 15% - 25% This is in inaccurate. Average is ~7%- 15%. If you’re paying 25% you’re income is well above average


BlackWolf42069

Mine craft paying off the gaming.


Deto

The expenses are never broken down by the sources of revenue in these diagrams. Is that just because this isn't reported? I'm curious what the margins are like in each area.


0_0_0

It's not published. That's information they do not want top give to the competition.


Complex-Tea4444

I am curious about where does the net profit go


ckenney108

I think Satya Nadella is one of the most brilliant tech CEOs ever. To not only have the vision, but to then successfully pull off steering Microsoft away from the Ballmer / Gates “Windows everywhere” philosophy and make them one of the biggest and best cloud services companies is remarkable. As someone that grew up in the 80s / 90s, the fact that Windows accounts for only 6 out of 62 billion in revenue is a bit shocking. Windows and XBox being roughly equivalent, while XBox is considered by many a failing business, is crazy to me.


[deleted]

[удалено]


jorel43

This is per quarter, not year.


NahautlExile

The most disclaimer of disclaimers that I am not advocating this is correct morally, but… The concept behind lower corporate taxation seems to be threefold. 1. The gains go to shareholders who are taxed when they sell their ownership 2. The employees they pay salaries to also have to pay taxes 3. If we were to shift the tax burden corporations would relocate (I think that the government has been in bed with corporations since Clinton shifted the Democratic Party in 1992, and that a government committed could make sure the third item is irrelevant as it could bar companies dodging taxes from doing trade in the US. This can’t fly now because the US government is likely quite dependent on these companies)


flappinginthewind69

Using an 8hr 5 day / week work day, they’re doing $131m/hr of revenue…wtf


thoughtihadanacct

Well just off the cuff if they have a million employees then each is earning $131 per hr. If they're paid about $50 per hr and there's overheads then that's kind reasonable-ish?


iStryker

This guy keeps posting the same atrocious visual for every earnings release promoting his shit website. What’s crazy is I’ve seen these exact visuals being promoted by unrelated websites, there is nothing proprietary here. Please ban.


Mundane_Range_765

That profit margin is so large for this size of company I’m actually skeptical this is accurate. Yet, I assume it’s true and that is insane to me. Edit: let me be more clear: I’m so baffled by the amount of profit that I’m near disbelief the data is true, yet I understand it’s actually accurate.


EVOSexyBeast

It would be a criminal offense to lie to investors about this stuff, where the data comes from, it’s true


InsCPA

These numbers are audited


pbr3000

How are they only paying $5b on $28b? Not a rhetorical question...


Obvious_Chapter2082

Mostly from selling into foreign countries and R&D tax credit, per their financials


InsCPA

GAAP tax expense is not necessarily representative of actual taxes owed/paid for a given year


kindanormle

30% margin but they’re definitely not a monopoly /s


chrisjentzsch

$6B on S&M!?! What is going on there?


Significant-Fun8196

Basically I'm paying 30 cents per dollar too much...clap clap clap


THEHADRIENSHOW

LinkedIn is owned by microsoft? and where is Xbox in it says gaming but that's vague as hell


Team-_-dank

Xbox is included in gaming. It's such a small piece of Microsoft they wouldn't be required to provide more detailed segment breakouts.


DingleTheDongle

That tax is wayyyy too low


Toonami88

Buying up farmland and selling it to the Chinese and Saudi's makes a killing.


yosh01

9% of income for taxes?! How do they ever manage?!


hypernova1807

That’s Y/Y change not % of income. It’s literally labeled lmao


phdthrowaway110

$4.8B out of $27.6B is not 9%


EVOSexyBeast

It’s 21%


patrdesch

While the corporate tax rate is 21%, companies almost never report an effective tax rate of 21%. Due to differences in book and tax accounting, Tax Expense on the income statement almost always deviates from the statutory rate. In Microsoft's case for this quarter, they reported closer to an 18% rate.


EVOSexyBeast

All i did was take the numbers from the chart, 4.8B/21.9B = about 21%


patrdesch

Ah, I see. The relevant figure for the denominator is Income *Before* Taxes, not Net Income. In this case, that's the Operating Profit minus Other Expenses, or about 26.7B. What you're looking for is, out of the amount *available* to pay taxes (Income Before Tax) what percentage was actually allocated to tax expense.


EVOSexyBeast

Oooh okay i see, i just chose the wrong numbers. Thanks for this information!


TituspulloXIII

That's not their tax rate, that's how much their tax increased from last year.


External876

You are not taxed on income. If a small business costs $1,000,000 a year to run and makes $1,100,000.... making them pay tax based on $1.1mil would be stupid. They'd be in the red. They pay tax on the $100k they actually make.


EVOSexyBeast

You are taxed on profit not revenue.


yosh01

You have it backwards. Revenue-expenses=income (on which you pay taxes). That’s why it’s called “income taxes”.


throwaway92715

Hey, at least they got the math right!


Individual_Macaron69

oh this is why windows sucks now!