Microsoft said the coronavirus pandemic has increased demand for its flagship products, reporting quarterly earnings Wednesday that beat Wall Street expectations.
The software giant said an ongoing trend of working and learning from home has fueled increased demand for its cloud computing services and workplace productivity products, such as email and video conferencing.
But the pandemic has also slowed sales of those products to smaller businesses, and eaten into the advertising revenue that powers its LinkedIn career networking service.
Microsoft on Wednesday reported fiscal fourth-quarter profit of $11.2 billion, or $1.46 per share, beating Wall Street expectations of $1.34 a share.
It posted revenue of $38 billion in the April-June period, up 13% from last year. Analysts had been looking for revenue of $36.5 billion, according to FactSet.
The company said its commercial cloud business surpassed $50 billion in annual revenue for the first time. But its LinkedIn service was hit by a weak job market and less money being spent on advertising.
LinkedIn announced Tuesday it is laying off nearly 1,000 employees, approximately 6% of its workforce globally. The job cuts take effect in August and will hit global sales and hiring sections of the company.
The pandemic has made other parts of Microsoft's business more appealing, including Xbox games and its workplace videoconferencing service known as Teams. One of its rivals, workplace chatting service Slack, filed a complaint against Microsoft on Wednesday in the European Union, accusing the software giant of anti-competitive behavior.
Slack said Wednesday that Microsoft illegally bundles its Microsoft Teams messaging product, which is similar to Slack, into Office 365, its package of email and other widely used business software. Slack says Microsoft forces companies to install it and blocks its removal.
Microsoft has said its competitive advantage over Slack stems from Teams capabilities for connecting people using video. Microsoft said Wednesday that it looks forward to providing the European Commission with more information and answering its questions about the Slack complaint.
California governor signs law to protect children from social media addiction
California will make it illegal for social media platforms to knowingly provide addictive feeds to children without parental consent beginning in 2027 under a new law Democratic Gov. Gavin Newsom signed Friday.
California follows New York state, which passed a law earlier this year allowing parents to block their kids from getting social media posts suggested by a platform's algorithm. Utah has passed laws in recent years aimed at limiting children's access to social media, but they have faced challenges in court.
The California law will take effect in a state home to some of the largest technology companies in the world. Similar proposals have failed to pass in recent years, but Newsom signed a first-in-the-nation law in 2022 barring online platforms from using users' personal information in ways that could harm children. It is part of a growing push in states across the country to try to address the impacts of social media on the well-being of children.
"Every parent knows the harm social media addiction can inflict on their children — isolation from human contact, stress and anxiety, and endless hours wasted late into the night," Newsom said in a statement. "With this bill, California is helping protect children and teenagers from purposely designed features that feed these destructive habits."
The law bans platforms from sending notifications without permission from parents to minors between 12 a.m. and 6 a.m., and between 8 a.m. and 3 p.m. on weekdays from September through May, when children are typically in school. The legislation also makes platforms set children's accounts to private by default.
Opponents of the legislation say it could inadvertently prevent adults from accessing content if they cannot verify their... Read More