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Cybersecurity is Microsoft’s Fastest Growing Business

Internet Armor

As people’s lives are increasingly spent online, cybersecurity concerns are on the front of their minds. Ransomware attacks have been on the rise, and recently the US government warned that Americans should expect heightened cybersecurity risk as a fallout from Russia’s war with Ukraine.

Fear of being victimized online is driving a surge in spending on protection from these threats. Individuals and companies are looking for ways to stay safe without giving up their online freedom.

Microsoft’s $15 Billion Business

In this environment, companies that provide internet security are benefitting from the increased demand. Microsoft (MSFT) recently revealed that their cybersecurity business is now generating a whopping $15 billion in annual revenue, representing 40% growth from the prior year. Some market analysts contend that while that rate of increase is not sustainable, the company’s practice of acquiring small companies could facilitate its continued expansion within the space.

The company’s cloud-based Azure Sentinel security solution now has over 15,000 customers.

Even the Giants are Vulnerable

Microsoft’s strong cybersecurity sales came as a surprise to some market observers. The tech giant’s competitors seem to have fallen farther behind. For example, Palo Alto Networks, one of the biggest players in the security sector, posted 21% growth year-over-year on less than $4 billion. That translates to less than half of what Microsoft was able to achieve.

It’s estimated that Microsoft captured around 8.5% of last year’s security software market, which is significantly larger than its industry peers. Still, competitors such as CrowdStrike (CRWD), Splunk (SPLK), Okta (OKTA), and Palo Alto Networks (PANW) remain optimistic amid the fierce competition. As cyber criminals plot out their next schemes, the tech sector continues to respond.

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James Flippin ABOUT James Flippin James Flippin is the son of a financial advisor who grew up hearing and learning about bond yields, interest rates, the stock market, and the ins and outs of Wall Street. After stints as a licensing and business broker for Marcus and Millichap in New York City, James moved into broadcasting and became a reporter and anchor. He covered crime, politics, finance, and tech at NBC News Radio while working part-time as a producer for SiriusXM. James graduated from the University of Delaware with a bachelor’s degree in political science and economics. He's also an accomplished podcaster with over 10-years of experience.

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