Microsoft: IT Spending Refresh Finally Arrives

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Desktops, servers and cloud-based services are seeing a boost in demand, according to Microsoft, which told analysts in an earnings call that the long-awaited technology refresh has begun.

Microsoft executives are saying they see the beginning of a long-heralded business IT refresh, and suggested during an April 22 earnings call that it could persist for a number of years. While Microsoft reported increased spending on its business products during the third quarter of fiscal 2010, revenues for the Microsoft Business Division remained lower than in the same quarter a year ago.

According to those executives on the earnings call, Microsoft's enterprise services grew at a quarterly rate of 5 percent, while revenue for its virtualization solutions rose by more than 20 percent. Revenue for its Server and Tools division reached $3.57 billion for the quarter, up from $3.49 billion during the same quarter in 2009. Sales of the Windows operating system are apparently expected to exceed sales of PCs, as customers upgrade existing devices in addition to purchasing new ones.

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