Microsoft reported their 1Q16 financial results yesterday, and so far they’ve been well-received–Microsoft stock is up around 10% this morning. Clearly, Microsoft strategy of shifting from a focus on the Windows platform to a “mobile-first, cloud-first” productivity platform is working.
Yes, Microsoft revenues were down on the quarter, but fluctuations in the dollar had a significant impact. Office 365 revenues were up almost 70%, cloud revenues were up 8%, and although the “More Personal Computing” segment was down, Microsoft’s newest and most exciting hardware products haven’t shipped yet.
Lost in the midst of all this was poor little Bing. Microsoft’s search engine, which powers not only Web search but Cortana, Bing Translator, and a host of other machine intelligence services as well, has been a perennial money-loser for the company. That finally changed, with Bing not only making some profits, but pouring greater than $1 billion dollars to Microsoft’s bottom line.
As ZDNet reports, Bing’s contributions to profits are a result of a combination of cost-cutting and streamlining efforts. AOL took over Microsoft’s display advertising, and Microsoft also backed out of map collection by handing off that business and its assets to Uber.
With Windows 10 and Cortana pushing out to a planned one billion machines in the next few years, and currently running on over 110 million machines to date, Bing is set for even more financial success. While Microsoft isn’t making a business out of search and advertising, with the impact such a business can have things like privacy, there’s nothing wrong with Bing paying its own way.
