The tech business week: tech’s highest earner, Microsoft revenues hit US$23.20bn

27 Oct 2014

Satya Nadella, CEO of Microsoft

A digest of the top business technology news stories from the past week, beginning with the news Microsoft CEO Satya Nadella is the tech industry’s biggest earner, with a package worth US$84.3m this year.

Microsoft CEO Satya Nadella is the highest earner in tech

Satya Nadella, CEO of Microsoft, is the biggest earner in the tech industry, with a package worth US$84.3m this year.

An SEC filing has revealed Nadella’s total compensation package for 2014 topped US$84m. This includes a salary of US$919,000, US$3.6m as a cash bonus and more than US$70m in share awards, the bulk of which cannot be cashed until 2019, provided targets are met.

Excluding one-time grants that stay put until 2019, Nadella’s package came in at US$11.6m so far this year.

Cloud and hardware sales drive Microsoft Q1 revenues of US$23.20bn

Microsoft reported Q1 revenues of US$23.20bn based on strong cloud and hardware sales. The company had to bite the bullet on the integration of Nokia’s Devices and Services business to the tune of US$1.14bn.

The software giant said Office 365 Home and Personal subscribers hit the 7m mark, up 25pc on the previous quarter.

A healthy consumer and business appetite for the company’s new Surface Pro 3 provided a nice revenue of US$908m.

The company sold more than 2.4m Xbox consoles, a 102pc increase year-on-year.

Windows Phone hardware revenue provided a whopping US$2.4bn worth of revenue.

Overall commercial revenue grew 10pc to US$12.2bn.

The big game changer has also been cloud, where commercial cloud revenues grew by 128pc, driven by Office 365, Azure and Dynamics CRM.

Windows volume licensing shot up by 10pc during the quarter.

iPhone juggernaut Apple makes US$8.5bn profit on Q4 revenues of US$42.1bn

Consumer tech giant Apple has reported a profit of US$8.5bn on revenues of US$42.1bn, driven by increased sales of iPhone and Mac products.

The revenues of US$42.1bn are up significantly from the revenues of US$37.5bn this time last year and profits of US$8.5bn are up a cool billion on the net profit of US$7.5bn recorded last year.

Apple is making a gross margin of 38pc on products, up from 37pc last year.

International sales outside the US accounted for 60pc of Apple’s revenue during the quarter.

IBM will pay US$1.5bn to offload unprofitable chip-manufacturing unit

Technology giant IBM is to pay US$1.5bn to offload an unprofitable chip-manufacturing unit to Globalfoundries Inc.

That’s according to Bloomberg sources, who say IBM will receive US$200m in assets. That makes the net value of the deal worth US$1.3bn to Globalfoundries, who will also acquire some engineers and intellectual property.

Based in Silicon Valley, California, Globalfoundries is a full-service semiconductor foundry with a global workforce of 13,000.

Airbnb has been valued at US$13bn

Lodging website Airbnb has been valued at US$13bn, marking a US$3bn increase from earlier this year for the firm.

According to The Financial Times, the growth has been announced as the company prepares an employee stock sale. To allow staff members to sell their shares, existing investors will be invited to buy back tens of millions of dollars worth of stock.

The valuation makes Airbnb the second most valuable private company in Silicon Valley, California, second only to ride-sharing service Uber.

Irishman Colm Long is the new chief revenue officer at Flipboard

Former Facebook head of global user operations Colm Long has joined digital magazine player Flipboard as chief revenue officer.

Long was instrumental in growing internet search giant Google’s EMEA operations when the company came to Ireland in 2002. Google now employs around 2,000 people in Dublin City.

In 2008, Long spearheaded social network Facebook’s arrival in Dublin, enabling it to grow from an initial headcount of 70 people to almost 1,000 people today.

Long is understood to have left Facebook in the past year to take time out and has been dipping his toes in the venture-capital space, leading a US$650,000 seed investment in Irish start-up PropelAd, which is led by Charlie Ardagh.

Financial results this week

Major tech companies are scheduled to release their latest financial results this week. Microblogging site Twitter is to report its results today, social network Facebook is set to report its earnings tomorrow, while business social network LinkedIn and daily deals site Groupon are to report their results on Thursday.

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