Microsoft emulating strategy used by Amazon, Salesforce to boost cloud business: report
Microsoft (NASDAQ:MSFT) is emulating a strategy used by Amazon (NASDAQ:AMZN) and Salesforce (NYSE:CRM), among others, to boost its cloud business, going after customers that traditionally have not used the cloud at all, The Information reported.




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The Redmond, Washington-based Microsoft is reportedly investing $200 million to build out an acquisition team so it can raise sales to cloud holdouts, a strategy that Amazon, Salesforce and Zoom (ZM) have used, the news outlet added.
These so-called midmarket customers have traditionally not used cloud products, making Azure a priority for the roughly 500 salespeople Microsoft (MSFT) hired to fill the niche.
Microsoft (MSFT), which is set to report fiscal third-quarter earnings Tuesday after the close, now generates 48% of its revenue from cloud-related products, up from 42% a year ago and 36% in 2020, according to investment firm Piper Sandler.
Analyst Brent Bracelin, who rates Microsoft (MSFT) overweight with a $352-a-share price target, noted that "the cloud model transformation at [Microsoft] should help insulate growth during the March quarter, despite rising global risks." 
A consensus of Wall Street analysts estimate that Microsoft (MSFT) earned $2.20 per share on $49.05 billion in sales during the quarter.


On Monday, Wedbush Securities said the results from Microsoft (MSFT) and Apple (AAPL) "could dictate the path of tech stocks over the coming months."