More Customers for Microsoft Cloud

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The world’s largest software maker Microsoft Corp. (MSFT) announced that it won customers such as Domino's Pizza, Xerox India and Pedcor Co. for its cloud and server services, Windows Server Hyper-V.

The Windows Server Hyper-V infrastructure software equips organizations with advanced cloud-based technologies that increase the efficiency of their operations by solving complex business challenges and improving resource allocation. It also facilitates communication and collaboration among companies and reduces IT expenses of these organizations and partners across the world.

The suite won on different counts at these players. Domino's Pizza deployed Windows Server Hyper-V to manage its in-store servers, which will make Domino's Pulse point-of-sale (:POS) application run smoothly. The server system was initially deployed at 750 stores with another 4,000 around the world expected to join soon. Following the installation of the system, virtualization-related desk calls have reduced 99% at Dominos.

The Xerox India Development Center (“IDC”), which supports its customers’ software development activities all over the world, deployed the service to collaborate efficiently with its customers.

Further, Pedcor Co. replaced its VMware (VMW) infrastructure with a Microsoft private cloud, built with Windows Server and System Center to improve its datacenter availability and install an efficient communication system for its employees located in 77 remote offices.

Currently, just like other PC makers, Microsoft is also battling the slump in the PC market caused by the sluggish economy. In addition, the popularity of smartphones and tablets from Apple (AAPL) and Google (GOOG) have been cannibalizing its core PC market. However, its server and tools business remains as strong as ever, which is evident from the series of wins it has announced in the recent past.

Microsoft remains one of the best positioned software vendors, given its wide range of products, emerging markets strength, continued technology deployment at data centers and growth in cloud computing. We believe that Microsoft’s current investments are supported by its strong balance sheet and expect these to drive the next growth phase, improving prospects of market share gains.

Microsoft reported revenues, excluding deferrals, of $21.46 billion in the second quarter of fiscal 2013, up 34.0% sequentially and 2.7% from last year, in line with our estimates. All except the Entertainment & Devices segment grew both sequentially and from the year-ago quarter.

Microsoft has a Zacks Rank #3 (Hold).

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