Microsoft announces changes to its financial reporting structure

Microsoft has reorganized the way it reports the financials for its various businesses by grouping them into three broad divisions.

Back in 2013, Microsoft announced company-wide changes which also included the new financial reporting structure encompassing all its business units into five divisions. However, the structure was a bit confusing as it also classified the divisions on the basis of Commercial and Consumer products. Now, the company has tried to simplify the reporting structure.

The new structure will feature the following three segments:

  • Productivity and Business Processes: It includes results from Office and Office 365 for commercial and consumer customers, as well as Dynamics and Dynamics CRM Online.
  • Intelligent Cloud: This segment includes results from public, private and hybrid server products and services such as Windows Server, SQL Server, System Center, Azure, and Enterprise Services.
  • More Personal Computing: Results from licensing of the Windows operating system, devices such as Surface and phones, gaming including Xbox consoles, and search will be reported in this segment.

Microsoft will be following the new structure for FY 2016, the first quarter report of which is scheduled for October 22nd. However, the company will also report revenue and gross margin based on the previous structure for this particular quarter to ensure smooth transition.

Source: PRNewsWire via ZDNet

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