Microsoft’s (MSFT) earnings report may have signaled a continued slowdown in cloud growth and a sharp decline in PC sales, but it also provided more insight into its growing security arm. According to the tech giant, security offerings are now a $20 billion annual business.
That’s double the $10 billion per year generated in 2021 and over $15 billion in 2022. Microsoft has previously committed to spending $20 billion from 2026 to 2026 to expand its security offerings.
“Even in this economically challenging time, organizations…everyone sees security as their top priority,” Vasu Jakkal, Microsoft’s CVP of security, compliance, identity and governance, told Yahoo Finance.
“This is an asymmetrical war…[customers] They don’t want to cut their security budgets. They invest heavily because protecting an organization is key to achieving its mission, innovating and serving its own customers,” said Jakkal.
Microsoft’s so-called Security Cloud consists of six products: Microsoft Defender, Microsoft Entra, Microsoft Intune, Microsoft Priva, Microsoft Purview, and Microsoft Sentinel. Each offering forms part of the broader security chain, from prevention and detection to compliance management.
According to Jakkal, security is an area where organizations spend the most and is easily justified for companies.
“Attacks don’t stop…especially in times of financial constraint,” Jakkal explained. “Ransomware is a good way for an attacker to make quick money, and the barrier to entry for ransomware has been significantly reduced.”
According to McKinsey & Company, the cybersecurity market could be worth $2 trillion as more businesses realize they don’t have the kind of protection and detection measures to keep their networks safe.
Meanwhile, Microsoft has seen customer numbers grow from 400,000 organizations in 2021 to 860,000 in 2023.
Despite such growth, Jakkal says there are still not enough cybersecurity professionals in the US. According to the Microsoft executive, there are between 3.5 and 4 million unfilled cybersecurity jobs in the US.
If Microsoft can fill even a small portion of these roles, it should be able to continue building its security platform with ease. But that means it should keep other players away, including CloudStrike (CRWD) and Palo Alto Networks (PANW).
Sign up for Yahoo Finance’s Tech newsletter
More content from Dan
Got a tip? Email Daniel Howley at firstname.lastname@example.org. Follow him on Twitter: @DanielHowley.
Click here for the latest tech business news, reviews, and helpful articles on technology and gadgets
Read the latest finance and business news from Yahoo Finance