One cannot talk about tech and the companies ruling the global market without featuring Microsoft heavily in that conversation. The world-renowned ‘Microsoft’ is one of the most valuable brands in the world thanks to the billions of dollars they make annually in terms of revenue. As a result of the diverse products and the enormous market shares that they control, Microsoft’s net worth is unbelievably high. They are truly one of the giants in the corporate world and their business is constantly expanding to new and emerging markets.
Microsoft was founded in Albuquerque, New Mexico by Bill Gates and Paul Allen in 1976 to sell microprocessors and software they were developing; but today, it has grown through the years to emerge as one of the leaders in the global business world. The company is known for software and hardware development, and a myriad of web-based services that provide simple and elegant solutions to day-to-day problems, so businesses and individuals can achieve their goals to the fullest extent. Today, Microsoft employs over 150,000 people from all walks of life and has been distinguished as the second-best employer of labor in the world. Let’s take a look at Microsoft’s net worth and how the company makes its money.
Is Microsoft The Biggest Tech Company In The World?
The most serious contenders in the race of the biggest tech companies in the world are Facebook, Amazon, Apple, Alphabet, and Microsoft. Every year, they run circles around each other and try to overtake whoever is in the lead, so it’s difficult to say for certain which is the biggest company of them all. However, one thing is almost certain and that is that Gates’ brainchild is actually one of the most valuable companies in the world, with just a few billion ahead of its counterparts.
How Much Is Microsoft’s Net Worth In 2020?
In late 2018, Microsoft joined Apple and Amazon, becoming the third company in history, to reach a market valuation of $1 trillion. However, the price of its shares have drifted back down, so Microsoft’s net worth as of 2019, is estimated at around $990 billion. That is undeniably a vast amount of money and the reason the company is held in such regard.
As of the first quarter of 2020, the company’s Operating income was valued at US$43.0 billion, its total revenue at US$125.8 billion and its total asset at US$286.55 billion.
Here Is How They Make Their Money
Microsoft’s net worth did not magically appear out of thin air. It has taken the company decades and an assortment of goods and services to get to where they are now. In fact, the company is constantly creating innovative products and solutions consumers use almost every day, and they have made tons of money from doing it.
Its net worth is at an all-time high thanks to the growth of its business lines and the leadership of the company’s new CEO, Satya Nadella. Under his watch, Microsoft has rebounded from the drudgery it seemed to have fallen into and has set out to retake its place as the biggest tech company in the world.
The tech company has the most diversified portfolio of all the tech companies in the world. Although Microsoft’s mainstay is the development and sales of personal computers, it has other business lines that keep the money flowing in and increases its net worth. For ease of understanding, let’s divide all of Microsoft’s product lines into major segments.
This has to do with both hardware and software technology that is used by consumers such as Microsoft computers, PC accessories, Microsoft Surface, and others. There’s also their gaming system like Xbox and all its attendant hardware and software services, from subscriptions to video games and third-party royalties. The Windows operating system, search advertising, and all Windows related offerings also come under this segment.
Productivity and Business Processes
A significant amount of Microsoft’s net worth comes from its products and services created for communication productivity, information, and business purposes. This includes Microsoft Office suite, Skype, Sharepoint, Microsoft Teams, Outlook, OneDrive, LinkedIn, cloud-based applications, as well as the licenses and subscriptions that come with these products.
See Also: How Much Is Apple Worth In 2019 And How Do They Make Their Money?
Another segment that comprises of money-making ventures for Microsoft is their cloud-based services which span across a variety of platforms and devices and features Azure, Microsoft SQL Server, System Center, Microsoft Consulting Services, Visual Studio, Premier Support Services, and Windows Server, amongst others. The company also enjoys constant streams of income from its artificial intelligence and research.