Follow the Money

Follow the money: That’s one of the catch phrases in detective novels or books when the good guys are trying to track down the bad guys, right? The phrase also works in politics when you’re trying to understand motivation, and it often works in business when you’re trying to understand where a company will be putting its priorities.

I don’t typically talk about Microsoft finances from my editorial soapbox, but Microsoft’s recent announcement about its earnings for the first quarter of its fiscal year 2007 (July through September 2006) caught my eye. The company’s announcement focuses heavily on SQL Server and the fact that strong sales of SQL Server are one of the brightest spots in overall company growth. Here are a few quotes, and some supporting data from the recent announcement:

“Server & Tools revenue increased 17% over the comparable quarter in the prior year, reflecting healthy performance for offerings such as SQL Server 2005, Windows Server, Visual Studio 2005 and BizTalk Server. SQL Server experienced revenue growth of over 30%, as customers are increasingly deploying SQL Server for their mission critical, transaction-oriented databases.”

You can find the entire earnings report, with supporting documentation, at http://www.microsoft.com/msft/earnings/FY07/earn_rel_q1_07.mspx#Channel. I know--boring, right? Well, you’ll better understand Microsoft if you understand what Microsoft is telling Wall Street and the financial markets. Peruse the data (including a nice, easy-to-follow PowerPoint summary at http://www.microsoft.com/msft/download/FY07/Q1-FY07Slides.ppt ), and you’ll see that Microsoft reports its income across just five major product divisions. SQL Server is part of the Servers and Tools group, which came in at number three in terms of total revenue. But Servers and Tools was the clear winner in terms of year-over-year growth for the past quarter. And SQL Server’s revenue increase of more than over 30 percent over the last year was the biggest component of that growth. As an aside, SQL Server’s 30 percent growth rate in revenue was ahead of all other major database competitors, in addition to being one of the driving forces behind Microsoft corporate growth over the last year.

What does that mean to SQL Server professionals? Well, for one, you can surmise that Microsoft corporate thinks that SQL Server is a pretty darn important part of the company, and you can expect resources to be allocated accordingly to ensure SQL Server’s strong growth continues. Even nicer, a rising tide tends to float all ships. Are you a SQL Server professional? Well, if the market for SQL Server is vibrant and growing at rates faster than its competition, you can rest assured that the phrase “follow the money” is relevant to your own personal financial health if you’re savvy about managing your SQL Server career in this growing and financially healthy market.