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> “How do you really tweak the incentives, go-to-market?” Nadella said. “At a time of platform shifts, you kind of want to make sure you lean into even the new

> “How do you really tweak the incentives, go-to-market?” Nadella said. “At a time of platform shifts, you kind of want to make sure you lean into even the new design wins, and you just don’t keep doing the stuff that you did in the previous generation.” Ok, sure, what does that mean though. > The company reported better-than-expected results, with $25.8 billion in quarterly net income, and an upbeat forecast in late April. Agree! Better tighten the belt. Don’t want to dip below $100 billion net income a year.

lwo32k 1y ago
> what does that mean though. The earnings call transcript is more useful than these stupid news articles - https://www.microsoft.com/en-us/Investor/earnings/FY-2025-Q2/press-release-webcast https://www.microsoft.com/en-us/Investor/earnings/FY-2025-Q2... Basically Azure earnings were at the low end of their own projections. And their explanation was Azure non-AI services earnings have dropped as customers who have ongoing non-AI projects are working out how to incorporate AI services.
- PKop 1y ago
  Stratechery's interpretation of CFO Amy Hood's explanation seems to be the exact opposite of what you're saying: non-AI outperformed more than AI, which showed positive results mostly from early capacity being brought on pulling forward already established demand. Stratechery: Everyone is very excited about the big Azure beat, but CFO Amy Hood took care to be crystal clear on the earnings call that the AI numbers, to the extent they beat, were simply because a bit more capacity came on line earlier than expected; the actual beat was in plain old cloud computing. From Hood’s prepared remarks: Focused execution drove non-AI services results where we saw accelerated growth in our enterprise customer segment, as well as some improvement in our scale motions. And in Azure AI services, we brought capacity online faster than expected. Hood further clarified in response to a question: Just to provide some clarity because I think your question implies something that we didn’t mean to imply on the call. First, the real outperformance in Azure this quarter was in our non-AI business. So then to talk about the AI business, really, what was better was precisely what we said. We talked about this. We knew Q3 that we had and hadn’t really match supply and demand pretty carefully and didn’t expect to do much better than we had guided to on the AI side. We’ve been quite consistent on that. So the only real upside we saw on the AI side of the business was that we were able to deliver supply early to a number of customers. And being able to do that throughout the quarter creates quite a good benefit to us. But the majority of our outperformance versus where we had expected to be was on the non-AI piece of the business.
zeroq 1y ago
When covid started a big name came to our office to announce cuts and saving plans. It was one hour townhall style meeting with everyone present to receive the news in person. I was shocked and flabergasted that someone could stand in front of couple hundred people and tell them with the same breath that the situation is so dire that we have to stop using printers and we'd better start bringing our own toilet paper to the office, and complain that the company only made 2 billion last year, which is absolute disaster and the company won't surive if we won't adapt. I was even more shocked when I approached fellow colleagues after the townhall, whom all seemed to completely swallow the pill - "you heard it? bollocks, right?" - "yeah, but you saw the charts, it's absolute disaster. I'm glad they took my bonus and let me keep my position".

lwo32k 1y ago

> what does that mean though. The earnings call transcript is more useful than these stupid news articles - https://www.microsoft.com/en-us/Investor/earnings/FY-2025-Q2/press-release-webcast https://www.microsoft.com/en-us/Investor/earnings/FY-2025-Q2... Basically Azure earnings were at the low end of their own projections. And their explanation was Azure non-AI services earnings have dropped as customers who have ongoing non-AI projects are working out how to incorporate AI services.

PKop 1y ago
Stratechery's interpretation of CFO Amy Hood's explanation seems to be the exact opposite of what you're saying: non-AI outperformed more than AI, which showed positive results mostly from early capacity being brought on pulling forward already established demand. Stratechery: Everyone is very excited about the big Azure beat, but CFO Amy Hood took care to be crystal clear on the earnings call that the AI numbers, to the extent they beat, were simply because a bit more capacity came on line earlier than expected; the actual beat was in plain old cloud computing. From Hood’s prepared remarks: Focused execution drove non-AI services results where we saw accelerated growth in our enterprise customer segment, as well as some improvement in our scale motions. And in Azure AI services, we brought capacity online faster than expected. Hood further clarified in response to a question: Just to provide some clarity because I think your question implies something that we didn’t mean to imply on the call. First, the real outperformance in Azure this quarter was in our non-AI business. So then to talk about the AI business, really, what was better was precisely what we said. We talked about this. We knew Q3 that we had and hadn’t really match supply and demand pretty carefully and didn’t expect to do much better than we had guided to on the AI side. We’ve been quite consistent on that. So the only real upside we saw on the AI side of the business was that we were able to deliver supply early to a number of customers. And being able to do that throughout the quarter creates quite a good benefit to us. But the majority of our outperformance versus where we had expected to be was on the non-AI piece of the business.

zeroq 1y ago

When covid started a big name came to our office to announce cuts and saving plans. It was one hour townhall style meeting with everyone present to receive the news in person. I was shocked and flabergasted that someone could stand in front of couple hundred people and tell them with the same breath that the situation is so dire that we have to stop using printers and we'd better start bringing our own toilet paper to the office, and complain that the company only made 2 billion last year, which is absolute disaster and the company won't surive if we won't adapt. I was even more shocked when I approached fellow colleagues after the townhall, whom all seemed to completely swallow the pill - "you heard it? bollocks, right?" - "yeah, but you saw the charts, it's absolute disaster. I'm glad they took my bonus and let me keep my position".