Microsoft’s New Financial Reporting Structure Highlights Strategy Shift

Microsoft is changing the way it reports its financial results, dividing all of its products into three main sections.

Starting from the start of its new financial year on October 22, when Microsoft will reveal how much money it has made since July 1, the company will report revenue, loss, and operating income in three portions: Productivity and Business Processes, Intelligent Cloud and More Personal Computing.

Three divisions

The Productivity and Business Processes segment now includes Microsoft’s Office products, alongside its Dynamics CRM division.

Just like what Amazon did earlier this year with AWS, the Intelligent Cloud will focus on revealing the earnings of Microsoft’s Azure cloud platform as well as Windows Server products.

Finally, the rather oddly named More Personal Computing section will report on Microsoft’s devices such as Surface tablet, Windows Phones and the Xbox. Interestingly, More Personal Computing also encompasses Windows 10, and by lumping all of these products together, Microsoft’s business strategy can clearly be seen.

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”.

It’s certainly a time of change at Microsoft this year, but no matter what the financial reporting structure looks like, the dollars aren’t going to hide anything.

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