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Customers are attracted to Microsoft's cloud offerings

Microsoft CEO Satya Nadella delivers a keynote address.
Microsoft CEO Satya Nadella delivers a keynote address.
Justin Sullivan/Getty Images

There has been a lot of anxieties among Microsoft investors and customers about how well the firm would make the transition from past CEO Steve Ballmer to the new CEO Satya Nadella. Things now look pretty good for the firm. Q1 earnings topped estimates with strong growth in Office 365 and Xbox sales reported PC World on April 24, 2014.

Although first-quarter calendar earnings for Microsoft beat estimates, profits and revenue both declined. However, the firm says its customers have begun to embrace its cloud offerings, particularly Office 365. Microsoft reported net income of $5.66 billion for the March quarter, which was down about 7 percent in comparison to the net income of $6.1 billion Microsoft reported a year ago. The firm also reported $20.40 billion in revenue, which was a 0.4 percent decrease in comparison to the $20.49 billion it reported for the first calendar quarter of 2013. Nadella said this quarter’s results demonstrated the strength of Microsoft along with the opportunities the firm sees in a mobile-first, cloud-first world.

Nadella also says Microsoft is making good progress in consumer services like Bing and Office 365 Home while commercial customers continue to embrace Microsoft's cloud solutions. Nadella says this positions the firm well for long-term growth. Even though profits fell from a year earlier Microsoft's fiscal third-quarter earnings beat Wall Street’s expectations reports Fox Business Network. This news coupled with Nadella's upbeat analysis for the firm's future appears to have investors feeling positive about Microsoft.