On last week’s earnings call with financial analysts, Workday Inc. CEO Aneel Bhusri was asked for his opinion on the broader economic outlook. He was both vague and definitive. His company wasn’t seeing problems in its own product pipeline, “but there is no question there is uncertainty in the air,” he said.
In HR departments, the uncertainty has turned into action, according to Gartner. In a survey of 171 HR managers, 92% said they are now “prioritizing budgeting and cost optimization initiatives.”
This means HR managers are taking specific steps to control spending, said Daniel Dirks, managing vice president at Gartner’s HR practice. The most likely effects are on department hiring and technology buying decisions, he said.
A hiring freeze would be near the top of HR budget actions, “because it is relatively easy to do,” Dirks said. HR managers are also taking a hard look at their tech vendor contracts. They are “making sure what was promised in the contract is really being delivered,” he said.
But no worries, so far, in HR tech
The concern about an economic downturn is not turning up in HR vendor spending.
On Aug. 29, Workday, for instance, reported total revenues of nearly $888 million, an increase of 32% from the same quarter a year ago.
Aneel BhusriCEO, Workday
ADP LLC recently reported a revenue increase of 6% to $14.2 billion. Lisa Ellis, a MoffettNathanson partner who leads its payments, processors, and IT services business, described the increase as “great results” on a July 31 analyst call. Ellis also noted on the call that ADP’s guidance for 2020 “implies a pretty robust outlook on the U.S. economy.”
Nonetheless, Dirks said there is a “change in sentiment and in mindset” in HR because of the economy. For the last 10 years, HR priorities have focused on finding talent and investing in tech; cost optimization is now emerging as a new priority. But Dirks said the new priority isn’t necessarily emerging at the expense of HR’s other priorities.
Gartner is also advising HR managers to play a broader role in watching the economy. It recommends teaming up with peers in finance and sales, for instance, to look at broader economic data.
HR managers have expertise in the labor market and may be able to identify market shifts. This could include, for instance, an increase in part-time hiring, if firms are becoming more conservative in hiring full time.
With Microsoft’s fourth quarter earnings, we delivered double-digit revenue growth across all segments anchored by the growing success in our commercial cloud as technology helps our customers power their innovation. Recently organizations like GE, PGA, NBA, Marks & Spencer, Starbucks, InMobiBayer and Telefonica shared how they are leveraging cloud and artificial intelligence to support growth and deliver great employee and customer experiences. Across industries and solution areas, here are some of the latest examples.
This week we unveiled a strategic partnership with Walmart as the company’s preferred cloud provider and strategic partner to accelerate its digital transformation in retail. Through a five-year agreement, Walmart has selected the full range of Microsoft cloud solutions, including Microsoft Azure and Microsoft 365 for enterprise-wide use, to help standardize across the company’s family of brands. Using a broad base of cloud, AI and Internet of Things (IoT) solutions, the company plans to further its mission in creating incredibly convenient ways for customers to shop and empower associates to do their best work.
We announced Campbell Soup Company selected Microsoft Azure. The much-loved soup and snack company announced plans to drive IT transformation with the help a global hybrid cloud solution. Campbell chose Azure to increase the flexibility, agility and resiliency of its always-on IT, provide employees with real-time access to customized information and insights, and optimize its complex supply chain.
At Microsoft Inspire this week, I was also thrilled to feature on stage Carlsberg and its ongoing digital transformation. For 171 years, the Carlsberg Group has been brewing for a better today and tomorrow. Now, the iconic brewery group is leveraging AI and IoT on Azure to bring more science to the craft of beer, increase speed to market and improve quality control through the “Beer Fingerprinting Project.”
Also onstage at Inspire, Microsoft CEO Satya Nadella shared how Walt Disney World Resort technology and conservation teams partnered with Microsoft to help develop the “tiniest smart homes” for the songbirds called purple martins. Purple martins are a unique species of bird that travel between South and North America each year to raise a family, but unfortunately their population is in decline. By outfitting birdhouses at Disney’s Animal Kingdom, using Azure IoT Edge with computer vision and building models to recognize important events, Disney scientists are able to learn more about the species and help inspire a new generation of conservationists in the parks. The scientists have unprecedented insight now into the nesting behavior of the purple martins. They are also creating new experiences for guests and have even built an augmented reality game on a tablet to help guests learn about what it takes to be a great purple martin parent.
We are seeing additional momentum in Azure IoT with one of our first customers for the new Azure Sphere. For more than 70 years, Sub-Zero and Wolf have built a legacy of innovation in food preservation and preparation. As the company looks toward the next wave of innovation, along with its new Cove dishwasher brand, Sub-Zero sees an opportunity to create more personalized experiences through connected products. Securing these products over the lifetime of the device is a top priority, and they are planning to use Azure Sphere as a comprehensive solution for future products to address security holistically at every layer.
When it comes to the modern workplace solution, we are seeing continued momentum across customers in the enterprise. The nearly 40,000 employees of Eli Lilly are on a mission to make medicines that help people live longer, healthier, more active lives. That is why Lilly takes a collaborative approach to discovering and developing new medicines — between lab researchers and the rest of the company, as well as with a global network of physicians, medical researchers and healthcare organizations — and has selected Microsoft 365 to bring together scientists across hundreds of locations and organizations and truly empower the workforce.
Across our Windows 10 and Surface business, we see customers taking advantage of how the right device can light up the modern workplace for employees. Melbourne-based infrastructure, building and rail leader John Holland selected 1,200 Surface Pros with LTE to power its field workers across large geographical construction zones. Using cellular and Wi-Fi, the Surface devices seamlessly connect workers with key information like blueprints and documents at project sites. As a Microsoft 365 E5 customer, the company has also deployed Surface Hub and Surface Book 2 devices. By standardizing on Microsoft modern workplace, John Holland is helping deliver a better experience to employees and a higher standard to customers.
With growing investments in Dynamics 365 as our third cloud, we are continuing to drive value for customers across various industries. National Oilwell Varco (NOV), a leading provider of technology, equipment and services for the global oil and gas industry, is deploying Dynamics 365 across its sales and field service networks worldwide. This deployment enables NOV to optimize productivity and minimize downtime by streamlining business processes and delivering a mobile-first approach to field service operations. NOV is investing in state-of-the-art technology and cloud services to deliver premier, customized experiences to customers.
Across every industry, businesses are expanding their digital business. These are just some of the most recent examples of leading enterprises choosing Microsoft solutions to help them transform customer experiences, fuel employee creativity and collaboration, innovate operations and bring new products to market.
Microsoft to host earnings conference call webcast
REDMOND, Wash. — April 4, 2018 — Microsoft Corp. will publish fiscal year 2018 third-quarter financial results after the close of the market on Thursday, April 26, 2018, on the Microsoft Investor Relations website at https://www.microsoft.com/en-us/Investor/. A live webcast of the earnings conference call will be made available at 2:30 p.m. PDT.
Microsoft (Nasdaq “MSFT” @microsoft) enables digital transformation for the era of an intelligent cloud and an intelligent edge. Its mission is to empower every person and every organization on the planet to achieve more.
For more information, financial analysts and investors only:
Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://news.microsoft.com. Web links, telephone numbers and titles were correct at time of publication, but may since have changed. Shareholder and financial information is available at http://www.microsoft.com/en-us/Investor/.
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In today’s Microsoft second quarter earnings call, CEO Satya Nadella showcased how customers are using our technology to create digital business solutions. The 56 percent year-over-year growth in commercial cloud revenue — with broad-based growth across geographic markets and industry segments — is fueled by customer and partner success.
Just this week, we announced news with Publicis Groupe, Columbia Sportswear and PTC. Communications and advertising giant Publicis Groupe is building its new AI-powered platform, Marcel, on Microsoft Azure and Office 365 to empower its 80,000 employees worldwide. Columbia Sportswear, innovator in active outdoor apparel, announced its choice of Dynamics 365 and Azure to its enhance worldwide consumer experience. Plus, PTC, a leader in product lifecycle management solutions that include Internet of Things (IoT), augmented reality and 3D computer-aided design for the industrial sector, has selected Azure as its preferred cloud platform.
Below are more customer highlights from this quarter.
In the industrial sector, United Technologies Corp. (UTC) builds and services millions of products, from elevators in some of the world’s tallest buildings to aerospace equipment. UTC is using Dynamics 365 and Azure to help its massive field organization better predict and respond to customer needs. Chevron announced Azure as its primary cloud for intelligent, digitized oil fields in order to increase revenues, reduce costs and improve the safety and reliability of operations.
Consumer product companies are innovating with the Microsoft cloud, too. Kohler has built a legacy of blending home comfort and style through innovation. This year marks Kohler’s entrance into the connected home market with a new line of kitchen and bathroom products, Kohler Konnect. For example, with Azure IoT, Kohler Konnect products respond to voice and in-app commands to manage bath temperature or start a shower.
In real estate, CBRE entered the smart building market with a customizable, connected workplace solution to give property investors and occupants a single, seamless access point to building amenities and services. Powered by Azure IoT, the CBRE 360 mobile apps will allow users to locate colleagues and navigate the workplace, reserve workspaces, and access food and beverage services, as well as basic building and high-end concierge services.
In retail, national grocery chain Kroger is leveraging Azure to power its EDGE (Enhanced Display for Grocery Environment) solution — a grocery-store shelf with digital screen displays showing prices, nutritional information and more. The system manages high volumes of data, better connects store management and customers and ensures stock does not run low. Home-improvement company Lowe’s worked with Fellow Robots to deploy autonomous LoweBots to assist with inventory data and shelf intelligence. As the LoweBot scans inventory on the shelves, Azure helps Lowe’s keep constant tabs on inventory and frees store employees to assist customers. Merkal Calzados, Spain’s leading retailer of affordable footwear, has chosen Dynamics 365 for retail, finance, operations, and customer service to transform how it selects and sources product, improve marketing and accelerate omnichannel growth.
One of the world’s largest casual dining companies, Bloomin’ Brands, Inc., chose Azure to help its digital transformation across approximately 97,000 team members and almost 1,500 restaurants. The parent company of Outback Steakhouse, Bonefish Grill, Carrabba’s and Fleming’s Steakhouse, Bloomin’ Brands is using Azure advanced analytics, machine learning and Power BI to enable guest engagement and convenience through mobile apps, websites and e-commerce, including the customer loyalty program.
In the healthcare sector, UMB Healthcare Services, a division of UMB Bank, continues to improve its health savings account (HSA) solution, powered on Azure, by creating a seamless customer experience for 1.2 million HSA accounts. For example, ReceiptVault allows HSA owners to safely manage their health care receipts in one place, which is an important tax requirement.
Aurora Health Care operates 15 hospitals, more than 150 clinics and 70 pharmacies throughout eastern Wisconsin and northern Illinois, Premera Blue Cross is the largest health plan in the Pacific Northwest, and UPMC is one of the largest integrated health care delivery networks in the U.S. These partners are working with us on a new AI-powered health bot project, currently in private preview. Powered by Cognitive Services and enriched with medical content, the bots give customers self-service access to their health-related questions and information.
In the government space, Kansas City’s Azure-powered solution from Opti improves water quality and saves local citizens and companies money. The solution uses a wide range of data to control rainwater entry into the sewer system and could reduce the overall cost of the program by almost a billion dollars over 25 years.
In the world of payment technology, Mastercard selected Microsoft 365 to support a modern workplace that empowers its employees’ teamwork and innovation. One of the largest companies in the payments space, Mastercard connects consumers, financial institutions, merchants and businesses in more than 210 countries and territories to achieve their vision of a world beyond cash. The company is also leveraging Azure for apps, including Masterpass, a digital mobile wallet and rewards program application.
In the auto industry, Volkswagen Group Digital is piloting new forms of workplaces. The company recently deployed Surface Books, Surface Pros, Surface Studios and Surface Hubs in its 10X service design lab and Future Centers, and to run its collaboration application, DEON. DB Schenker, a division of Deutsche Bahn AG, focuses on logistics across air, land, sea freight as well as contracts logistics. The company turned to Windows 10 to help safeguard its business with intelligent, built-in security and to empower the productivity of its global, mobile workforce.
Across the globe, industry leaders are choosing Microsoft to power their business strategies and new products, or support culture change. I am constantly inspired by our customers’ and partners’ digital ambitions and innovation, and I am eager to continue partnering with them on their digital journey.
Today, Microsoft announced its first quarter earnings. One big takeaway is that we exceeded our goal to meet a $20 billion in commercial cloud annualized revenue run rate. This exciting milestone represents our continued delivery of new cloud technologies and our customers’ digital innovation. Across major industries — from finance and energy sector to retail and professional sports — organizations are betting on Microsoft to help them transform their customers’ experiences, employee productivity, operations and products. In fact, 96 percent of Fortune 500 companies have at least one of our cloud offerings, and 90 percent have at least two. I will share some of the product news and customer stories.
Last quarter, we shipped a range of cloud infrastructure and applications to give customers the foundation for new digital services. Our hybrid cloud solution, Azure Stack, is now available through hardware partners to help companies realize the benefits of an “intelligent cloud, intelligent edge.” We also introduced Azure Confidential Computing, an industry-first advancement in cloud security. Our differentiated hybrid cloud approach addresses the real-world needs of customers and is a key reason they are choosing to partner with Microsoft.
During the same period, Bank of America selected Azure for its tech infrastructure modernization and business transformation, including a goal to deliver 80 percent of its workloads in the cloud in the next few years. Also in financial services, TD Bank and Sumitomo Mitsui Banking Corporation are using Azure and its data services to improve customer experiences. And the largest security technology company, Symantec, runs Norton security on Azure to help protect 50 million people, a key part of its hybrid cloud strategy.
From oil and gas to healthcare, industry leaders are choosing Azure. BP chose Azure to power its proprietary data lake to make better business decisions. Schlumberger’s new DrillPlan digital well construction solution relies on Azure and the Azure Stack, as well as Office 365 and Microsoft Teams. And, Haliburton’s DecisionSpace 365 digitizes the oil field with IoT on Azure. This week, we announced an alliance with PAREXEL, a leading biopharmaceutical services organization, to drive transformation in the life sciences industry powered by Azure technology. Together we’re aiming to accelerate the drug development process, reducing the time it takes to bring therapies to market and into the hands of patients.
Microsoft continues to invest in data and AI solutions that help customers convert raw information into insights and intelligent services. The new generation of Azure Machine Learning makes it easy to develop, experiment and deploy AI models on any data, at any scale. The new SQL Server 2017 is a hybrid cloud database for a company’s most important apps, with built-in AI and world-class security.
Steelcase is using Azure IoT to develop Steelcase Workplace Advisor and the Steelcase Personal Assistant app, which help organizations create workplaces that respond to the needs of people while also optimizing real estate investments. Online fashion retailer ASOS is using our global database service, Azure CosmosDB, to better serve 15 million active customers with relevant product recommendations as it introduces 5,000 new products every week. Progressive, one of the largest auto and homeowner insurance carriers, is using Microsoft AI to build its Flo Chatbot and transform the insurance quoting process. And Huawei is delivering real-time translation on the new Mate 10 series device using Microsoft Translator running on our Cognitive Services.
We are infusing AI into all our products, and this last quarter we announced Dynamics 365 AI solutions —part of our focus on business applications that modernize work processes. The first solution, already in use at HP Inc., includes an intelligent virtual agent for customer care and service. And across the board, customers of all stripes are adopting Dynamics 365 to reinvent how they do business, from the U.S. Department of Veterans Affairs to the Seattle Seahawks. Our hometown football team is all in with Microsoft’s Cloud, Dynamics 365 and devices throughout its organization.
Fostering the modern workplace is a top priority as well. We want to empower everyone to be more creative and collaborative with Office 365, Windows 10 and security technology. In the first quarter, we advanced this effort with the introduction of Microsoft 365 F1 for the world’s 2 billion first-line workers, as well as Microsoft 365 Education, including Minecraft, for students and teachers.
From retail to automotive, we’re seeing companies leverage the power of our cloud to help their workforce collaborate. Lowe’s, a FORTUNE® 50 home improvement company, is creating a modern workplace for 260,000 employees and more personalized service in 2,200 stores, providing anytime access to productivity tools from any device, including Surface Hubs. Devon Energy, a Fortune 500 oil and natural gas exploration and production company, uses Microsoft 365 to connect field employees with engineers and petrochemical professionals a thousand miles away.
The Coca-Cola Co., the world’s largest beverage company, has selected and will deploy Windows 10 to be the foundation to safeguard its business with intelligent security built-in to modernize end user IT management processes to reduce cost, and to empower and unlock the creativity of its global workforce. Canadian Imperial Bank Corporation is deploying Windows 10 as the foundation of its modern IT workplace. The move will help empower their employees, improve efficiency and modernize end-user technology management tools and processes. Ford designers are using mixed reality to blend 3D holograms digitally with both clay models and physical production vehicles, allowing them to experiment and iterate on design much more quickly.
I am inspired every day by how our customers are embracing digital transformation to create lasting value. At Microsoft, nothing is more important than the success of their transformation, which is why we are committed to partnering at every step of their digital journey.
Microsoft to host earnings conference call webcast
REDMOND, Wash. — Oct. 10, 2017 — Microsoft Corp. will publish fiscal year 2018 first-quarter financial results after the close of the market on Thursday, Oct. 26, 2017, on the Microsoft Investor Relations website at https://www.microsoft.com/en-us/Investor/. A live webcast of the earnings conference call will be made available at 2:30 p.m. Pacific Time.
Microsoft (Nasdaq “MSFT” @microsoft) is the leading platform and productivity company for the mobile-first, cloud-first world, and its mission is to empower every person and every organization on the planet to achieve more.
For more information, financial analysts and investors only:
Investor Relations, Microsoft, (425) 706-4400
For more information, press only:
Microsoft Media Relations, WE Communications for Microsoft, (425) 638-7777, [email protected]
Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://www.microsoft.com/news. Web links, telephone numbers and titles were correct at time of publication, but may since have changed. Shareholder and financial information is available at https://www.microsoft.com/en-us/Investor/.
Cisco’s latest earnings report reflects the pains of a legacy vendor struggling to overhaul an outdated business model while rivals chip away at its market share.
Overall Cisco revenues dropped 4% year over year for the quarter ended July 29, to $12.1 billion, the company reported this week. Cisco expected the decline to continue in the current quarter, forecasting a reduction of between 1% and 3%. The drop in the October quarter would mark nearly two straight years of declines.
Cisco’s troubles are mostly due to the steady weakening of its switching business — the company’s largest. Sales of switches in the July quarter fell 9%. The company reported the same decline in its router business, another important hardware line.
Falling Cisco revenues show rivals cutting into market share
While Cisco stumbled, switching rivals Arista Networks and Juniper Networks reported double-digit growth in their June quarters.
“Rivals are chipping away at Cisco, for sure,” said Glenn O’Donnell, an analyst at Forrester Research. “In many ways, they [rivals] are reacting more effectively at what the market really needs.”
Cisco’s competitors have been more successful at selling to cloud and communication service providers that favor products less likely to tie them to a single vendor. At the same time, enterprises — Cisco’s core customers — are buying fewer switches, as they migrate more software to cloud providers.
“Cisco’s decline in their core market is another signal that the general networking vendor is an old business model,” said Andre Kindness, an analyst at Forrester.
Cisco’s solution to revenue drop
Cisco understands its dilemma and is gradually moving away from its legacy hardware approach to networking. The company has introduced software that centralizes network control, so operators no longer have to make changes box by box.
In June, Cisco introduced a central software console, called the Digital Network Architecture Center, for managing a campus network. The hardware underpinning is a new line of Catalyst switches, called the 9000 Series.
Andre Kindnessanalyst at Forrester Research
Cisco attributed its latest drop in switch revenue to the product launch. “Anytime we do a major platform announcement, particularly in switching, there is a period of time where our customers pause because they want to understand what this means,” Cisco CEO Chuck Robbins told financial analysts following the latest earnings report.
Within the enterprise data center — Cisco’s historic sweet spot — the company has been pushing customers to switch to its software-defined networking platform, called Application Centric Infrastructure. ACI is also dependent on Cisco hardware, namely the Nexus 9000 Series of switches.
Enterprise adoption of ACI, which Cisco started shipping in 2014, has been slow, according to analysts. In February, Gartner reported that only 30% of companies buying Nexus 9000 switches were also using ACI.
Forrester has found that many businesses are choosing VMware’s competing NSX because it requires fewer architectural changes within the data center. “Cisco ACI is an all-or-nothing proposition,” Kindness said.
Also, ACI is less flexible when working with third-party appliance vendors. Companies using ACI are often limited to products from Cisco partners for load balancing and firewalls.
“My clients don’t want to have one vendor dictate the other vendors,” Kindness said.
Cisco revenues from security slow
To mitigate its troubles in networking, Cisco has been focusing on high-growth areas in the tech industry, such as the internet of things, technology for connecting data centers to the cloud and security. In security, Cisco’s revenues failed to meet analysts’ expectations for the July quarter, reporting 3% growth, which was significantly less than the 16% increase a year ago and the 9% growth in the previous quarter.
Despite the slowdown, Robbins said he had “zero concerns about the business,” because the company has recently recorded “some of the strongest order growth as we’ve seen in the last two years.”
Cisco’s approach to security is to sell it as part of an overall purchase of networking infrastructure, and not as a solo product. As a result, security sales will tend to move up or down depending on sales of switches and other products.
“I think we should wait a few quarters to see where this goes,” said Patrick Moorhead, an analyst with Moor Insights & Strategy, based in Austin, Texas. “The security products are so linked to their networking products that we didn’t see the numbers that the street [Wall Street] had expected.”
If Moorhead has it right, then security sales will improve as sales of switches head north. But indicators are Cisco has yet to reach the bottom.