1、1Dear shareholders,colleagues,customers,and partners:We are living through a period of historic economic,societal,and geopolitical change.The world in 2022 looks nothing likethe world in 2019.As I write this,inflation is at a 40-year high,supply chains are stretched,and the war in Ukraine isongoing.

2、At the same time,we are entering a technological era with the potential to power awesome advancementsacross every sector of our economy and society.As the worlds largest software company,this places us at a historicintersection of opportunity and responsibility to the world around us.Our mission to

3、empower every person and every organization on the planet to achieve more has never been moreurgent or more necessary.For all the uncertainty in the world,one thing is clear:People and organizations in everyindustry are increasingly looking to digital technology to overcome todays challenges and eme

4、rge stronger.And nocompany is better positioned to help them than Microsoft.Every day this past fiscal year I have had the privilege to witness our customers use our platforms and tools to connectwhat technology can do with what the world needs it to do.Here are just a few examples:Ferrovial,which b

5、uilds and manages some of the worlds busiest airports and highways,is using our cloudinfrastructure to build safer roads as it prepares for a future of autonomous transportation.Peace Parks Foundation,a nonprofit helping protect natural ecosystems in Southern Africa,is using MicrosoftDynamics 365 an

6、d Power BI to secure essential funding,as well as our Azure AI and IoT solutions to helprangers scale their park maintenance and wildlife crime prevention work.One of the worlds largest robotics companies,Kawasaki Heavy Industries,is using the breadth of our toolsfrom Azure IoT and HoloLensto create

7、 an industrial metaverse solution that brings its distributed workforcetogether with its network of connected equipment to improve productivity and keep employees safe.Globo,the biggest media and TV company in Brazil,is using Power Platform to empower its employees tobuild their own solutions for ev

8、erything from booking sets to setting schedules.And rsted,which produces a quarter of the worlds wind energy,is using the Microsoft Intelligent DataPlatform to turn data from its offshore turbines into insights for predictive maintenance.Amid this dynamic environment,we delivered record results in f

9、iscal year 2022:We reported$198 billion in revenue and$83 billion in operating income.And the Microsoft Cloud surpassed$100 billion in annualized revenue for the first time.OUR RESPONSIBILITYAs a corporation,our purpose and actions must be aligned with addressing the worlds problems,not creating new

10、 ones.At our very core,we need to deliver innovation that helps drive broad economic growth.We,as a company,will do wellwhen the world around us does well.Thats what I believe will lead to widespread human progress and ultimately improve the lives of everyone.There is nomore powerful input than digi

11、tal technology to drive the worlds economic output.This is the core thesis for our being as acompany,but its not enough.As we drive global economic growth,we must also commit to creating a more inclusive,equitable,sustainable,and trusted future.Support inclusive economic growthWe must ensure the gro

12、wth we drive reaches every person,organization,community,and country.This starts withincreasing access to digital skills.This year alone,more than 23 million people accessed digital skills training as part ofour global skills initiative.2But skills alone arent enoughwe need to help people better pre

13、pare for and connect to jobs.Thats why wevecommitted to equip 10 million people from underserved communities with skills for jobs in the digital economy by 2025.One area of digital skills has become especially critical:cybersecurity.Cybersecurity is a significant threat forgovernments,businesses,and

14、 individuals around the world,yet there simply arent enough people with cybersecurityskills to fill open jobs.To help address this,weve committed to skill and recruit 250,000 people into the US cybersecurity workforce by 2025especially those underrepresented in the field.And were helping an addition

15、al 24 countries with substantial cybersecurityworkforce shortages close their gaps too.We also continue to deliver affordable,relevant cloud technology and industry-specific solutions to nonprofit organizationsaddressing the worlds most pressing issues.This year,we provided$3.2 billion in donated an

16、d discounted technology to302,000 nonprofits serving over 1.2 billion people globally.And earlier this month,we announced that Microsoft willdouble the number of nonprofits we reach worldwide over the next five years.Protect fundamental rightsWe unequivocally support the fundamental rights of people

17、,from defending democracy,to protecting human rights,toaddressing racial injustice and inequity.And,as peoples access to education,healthcare,jobs,and other critical servicesbecomes increasingly dependent on technology,its clear that access to broadband and accessible technology is alsofundamental t

18、o building a more equitable future.Since 2017,weve helped more than 50 million people in unserved rural communities globally gain access to affordablebroadband coverage.Building on our work in eight US cities,were now partnering with five US states with significantbroadband adoption gaps to increase

19、 access,adoption,and equity.Andgiven the importance of current data tobroadband planningthe new Microsoft Digital Equity Dashboard will help US policymakers and communities identifyneighborhoods where funding and programmatic investment can achieve measurable impact.This year,we continued our journe

20、y to address racial injustice and inequity by increasing representation within Microsoft,engaging our ecosystem,and strengthening our communities.Across our ecosystem,we are more than 90%of the way toward our commitment to spend an incremental$500 millionwith Black-and African American-owned supplie

21、rs.Weve coordinated over 80 justice reform partnerships to help 145communities expand access to data-driven insights that advance a more equitable system of justice and public safety.And weve expanded our Technology Education and Learning Support(TEALS)program to 290 high schools in cities withlarge

22、 Black and African American communitiesto promote more equitable access to computer science education.Our work to help preserve,protect,and advance democracy by promoting a healthy information ecosystem andsafeguarding electoral processes is as salient as ever in todays geopolitical climate.Our Acco

23、untGuard nation-statethreat notification service protects more than 4 million accounts of election officials,human rights organizations,journalists,and other organizations.Our efforts to preserve and protect journalism in the United States and Mexico have beenextended globally through new partnershi

24、ps with the Thomson Reuters Foundation,Report for the World,and others.This year,we responded to six humanitarian emergencies in five countries through donations,technology,services,andemployee giving.As of July 2022,weve committed$257 million in financial and technology assistance to the globalresp

25、onse to the war in Ukraine,including support for government,businesses,nonprofits,and humanitarian assistance forrefugees.And,through our AI for Humanitarian Action initiative,were helping organizations harness the power of AI toimprove their disaster preparedness,response,and recovery.Finally,we co

26、ntinued working toward our five-year commitment to bridge the disability divide for the more than 1 billionpeople around the world with disabilities,seeking to expand accessibility in technology,the workforce,and3workplace.As just one example of this work,use of our Office Accessibility Checkerour“s

27、pell check”for accessibilityhas grown by 9x over the past year.And,along with partner companies,we launched the Neurodiversity CareerConnector,a jobs marketplace for neurodivergent job seekers.Create a sustainable futureWe must ensure that economic growth does not come at the expense of our planet.A

28、ddressing climate change requiresswift,collective action and technical innovation.Were continuing our pursuit of our own ambitious commitments andhelping others achieve their climate goals,aided by technology.In March,we released our second annual sustainability report,sharing our progress,challenge

29、s,and learnings as wepursue our commitments to become carbon negative,water positive,and zero waste.Although we continued to makeprogress on several of our goals with an overall reduction in Scope 1 and Scope 2 emissions,our Scope 3 emissionsincreased,due in large part to significant global datacent

30、er expansions and the growth in Xbox sales and usage.Despitethese increases,we remain dedicated to achieving a net-zero future.We recognize that progress wont always be linear,and the rate at which we can implement emissions reductions is dependent on many factors that can fluctuate over time.On the

31、 path to becoming water positive,we invested in 21 water replenishment projects that are expected to generateover 1.3 million cubic meters of volumetric benefits in nine water basins around the world.Progress toward our zero wastecommitment included diverting more than 15,200 metric tons of solid wa

32、ste otherwise headed to landfills and incinerators,as well as launching new Circular Centers to increase reuse and reduce e-waste at our datacenters.We contracted to protect over 17,000 acres of land(50%more than the land we use to operate),thus achieving ourcommitment to protect more land than we u

33、se by 2025.And with Microsoft Cloud for Sustainability,were expanding our work to help customers meet their ambitioussustainability goals by enabling them to better collect,track,and analyze the metrics of their sustainability strategy.Earn trustTo drive positive impact and growth with technology,pe

34、ople need to be able to trust the technologies they use and thecompanies behind them.We are committed to earning trustboth trust in business model alignment with our customersand partners,and trust in technology,spanning privacy,security,digital safety,the responsible use of AI,andtransparency.Were

35、dedicated to preserving our customers privacy and their ability to control their own data.We advocate for strongprivacy laws that require companies,including ours,to be accountable and responsible in their collection and use ofpersonal data.Thats why we supported the new Trans-Atlantic Data Privacy

36、Framework and committed to meet orexceed all the requirements it outlines.And through the Microsoft privacy dashboard,millions of people each year canmake meaningful choices about how their data is used.Security and digital safety are foundational to trust in todays complex threat landscape.We analy

37、ze 43 trillion securitysignals daily and use the insights to inform increased protections.This year,we blocked 34.7 billion identity threats and37 billion email threats.Over the past four years,weve sent over 67,000 nation-state-related threat notifications tocustomers to help them protect themselve

38、s from digital threats.This comprehensive capability has been critical during recent world events,including the war in Ukraine.Our efforts haveinvolved both defending key infrastructure in the countryincluding assisting with the detection and disruption ofcyberattacks and cyberinfluence operations a

39、nd evacuating data to the cloudas well as supporting people,communities,and organizations on the ground as part of our humanitarian and disaster response.4Our commitment to responsibly develop and use technologies like AI is core to who we are.We put our commitment intopractice,not only within Micro

40、soft but by empowering our customers and partners to do the same and by advocating forpolicy change.We released our Responsible AI Standard,which outlines 17 goals aligned to our six AI principles andincludes tools and practices to support them.And we share our open-source tools,including the new Re

41、sponsible AIDashboard,to help developers building AI technologies identify and mitigate issues before deployment.Finally,we provide clear reporting and information on how we run our business and how we work with customers andpartners,delivering the transparency that is central to trust.Our annual Im

42、pact Summary shares more about our progressand learnings across these four commitments,and our Reports Hub provides detailed reports on our environmental data,our political activities,our workforce demographics,our human rights work,and more.We should all be proud of this workand I am.But its easy t

43、o talk about what were doing well.As we look to the nextyear and beyond,well continue to reflect on where the world needs us to do better.OUR OPPORTUNITYNow,let me turn to how we are positioned to capture the massive opportunities ahead.Over the past few years,Ivewritten extensively about digital tr

44、ansformation,but now we need to go beyond that to deliver on what I call the“digitalimperative.”Technology is a deflationary force in an inflationary economy.Every organization in every industry will need to infusetechnology into every business process and function so they can do more with less.Its

45、what I believe will make thedifference between organizations that thrive and those that get left behind.In the coming years,technology as a percentage of GDP will double from 5%to 10%and beyond,as technology movesfrom a back-office cost center to a defining feature of every product and service.But e

46、ven more important will betechnologys influence on the other 90%of the worlds economy.From communications and commerce,to logistics,financial services,energy,healthcare,and entertainment,digital technology will power the entire global economy as everycompany becomes a software company in its own rig

47、ht.Across our customer solution areas,we are delivering powerful platforms,tools,and services that expand our opportunityto help every organization in every industry deliver on the digital imperativewith a business model that is trusted andalways aligned with their success.Apps and infrastructureWe

48、are building Azure as the worlds computer,with more than 60 datacenter regionsmore than any other providerdelivering faster access to cloud services while addressing critical data residency requirements.With Azure Arc,werebringing Azure anywhere,meeting customers where they are and enabling them to

49、run apps across on-premises,edge,ormulticloud environments.And were extending our infrastructure to the 5G network edge with Azure for Operators,introducing new solutions to help telecom operators deliver ultra-low-latency services closer to end users.As the digital and physical worlds come together

50、,were also leading in the industrial metaverse.From smart factories,tosmart buildings,to smart cities,were helping organizations use Azure IoT,Azure Digital Twins,and Microsoft Mesh todigitize people,places,and things,in order to visualize,simulate,and analyze any business process.Data and AIFrom be

51、st-in-class databases and analytics to data governance,we have the most comprehensive data stack to helpevery organization turn its data into predictive and analytical power.With our new Microsoft Intelligent Data5Platform,we are helping customers focus on creating value instead of integrating a fra

52、gmented data estate.Cosmos DBis the go-to database powering the worlds most demanding,mission-critical workloads,at any scale.With Azure Synapse,were removing traditional barriers between enterprise data warehousing and big data analytics so anyone can collaborate,build,and manage analytics solution

53、s.And were creating an entirely new market category with Microsoft Purview,as wehelp organizations govern,protect,and manage their data estate across platforms and clouds.When it comes to AI,were seeing a paradigm shift as the worlds large AI models become platforms themselves.And weare helping orga

54、nizations apply the worlds most advanced coding and language models to a variety of use cases,suchas writing assistance,code generation,and reasoning over data with our new Azure OpenAI Service.Digital and app innovationWe have the most popular developer tools for any cloud and any platform to help

55、organizations modernize existing appsand build new ones.GitHub is the most complete developer platform to build,scale,and deliver secure software.Thisyear,we introduced GitHub Copilot,a first-of-its-kind AI pair programmer,to help developers write better code faster.Andorganizations are increasingly

56、 turning to both Visual Studio and our Azure PaaS services to streamline development andcreate modern,more resilient cloud-native applications.Low-code/no-code tools are rapidly becoming a priority for every organizations digital capability.With Power Platform,weare helping domain experts rapidly dr

57、ive productivity gains when its never been more important.We have nearly25 million monthly active users.And were innovating to make it even easier for teams of professional and citizendevelopers to automate workflows,create apps,build virtual agents,and analyze data.Business applicationsWith our exp

58、anding portfolio of business applications,we are helping every business become a hyperconnectedbusinessunifying data,process,and teams across the organization.New Dynamics 365 Connected Spaces helpsorganizations across diverse industriesfrom real estate and retail,to factories and constructionmanage

59、 their physicaloperations.And with new integrations between Dynamics 365 and Teams,we are creating a new category ofcollaborative applications that helps businesses surface data and insights right in the flow of work.Our industry clouds bring together capabilities across the Microsoft Cloud with ind

60、ustry-specific customizations to helporganizations improve time to value,increase agility,and lower costs.We completed our acquisition of NuanceCommunications this year,adding new cloud and enterprise AI capabilities for healthcare,as well as other industries.Andas sustainability becomes an existent

61、ial priority not just for our society but for every organization,our new Microsoft Cloudfor Sustainability,which I mentioned earlier,is helping our customers record,report,and ultimately reduce theirenvironmental impact.Modern workHybrid work is now just work.Every organization is looking to reconne

62、ct and reengage the workforce at home,in the office,and everywhere in between.Microsoft Teams is the most used and most advanced platform for work,surpassing270 million monthly active users this year.Its the only solution with meetings,calls,chat,collaboration,and businessprocess automation in one p

63、lace.Teams Rooms is bringing Teams to a growing ecosystem of devices to help organizations rethink their approach to spaceand help employees participate fully in meetings from anywhere.And with Microsoft Viva,were building an employeeexperience platform that brings together communications,knowledge,

64、learning,resources,and insights in the flow of workto empower employees and strengthen their connection to their companys mission and culture.6Modern lifeThe PC has never been more relevant to work,life,and play.This year,we launched Windows 11,the biggest update toour operating system in a decade.I

65、t reimagines everything from the user experience to the store to help people andorganizations be more productive,connected,and secure,and to build a more open ecosystem for developers andcreators.There are now more than 1.4 billion monthly active devices running Windows 10 or Windows 11.We launchedn

66、ew Surface devices to support every person and work style.And we have nearly 60 million Microsoft 365 consumersubscriptions as we help people create,connect,and share wherever they go.SecurityCybersecurity is the number one threat facing every business today.To keep our customers secure,we build sec

67、urity bydesign into every product we sell,and we deliver end-to-end solutions spanning security,compliance,identity,devicemanagement,and privacy across clouds and platforms.We are the only cloud provider with multicloud protection for theindustrys top three cloud platforms.Our new Entra product fami

68、ly includes tools for permissions management,identitygovernance,and identity verification.And we now offer managed threat detection and response with Microsoft SecurityExperts.LinkedInLinkedIn has become mission critical to connect creators with their communities,job seekers with jobs,learners with

69、skills,and marketers with buyers.LinkedIn now has more than 850 million members,and our Sales,Talent,Marketing,andPremium Subscriptions lines of business have all surpassed$1 billion in annual revenue over the past 12 months.Search,advertising,and newsWhen it comes to advertising,we are creating a n

70、ew monetization engine for the weban alternative that offersmarketers and publishers more long-term viable ad solutionswhile upholding consumer privacy and strong datagovernance.Were focused on increasing our share and engagement across our browser Microsoft Edge,our searchengine Microsoft Bing,and

71、our personalized content feed Microsoft Start.And with our acquisition of Xandr,we now power one of the largest marketplaces for premium advertising.Netflix choseus this summer as its exclusive technology and sales partner for its first ad-supported subscription offering,a validation ofthe different

72、iated value we provide to publishers looking for a flexible partner to build and innovate with them.I couldnt bemore excited about our expansive opportunity ahead in this space.GamingThe big bets we have made across content,community,and cloud over the past few years continue to pay off.Weve soldmor

73、e Xbox Series S and Series X consoles life-to-date than any previous generation of Xbox,and with Xbox CloudGaming,were bringing games to entirely new endpoints.In the past year,weve made many of our most popular titlesaccessible on phones,tablets,TVs,and low-spec PCs for the first time.Our Xbox Game

74、 Pass subscription service nowincludes access to hundreds of games.And with our planned acquisition of Activision Blizzard,we aim to give playersmore choice to play great games wherever,whenever,and however they want.Choice is equally important to developers,who we want to support with a diversity o

75、f distribution and business models for their games.We believe the acquisitionwill unlock opportunities for innovation and enable the industry to grow.OUR CULTUREOur culture is the foundation on which our mission and strategy stand,and cultivating it is our greatest priority.Werealways working to clo

76、se the gap between our espoused culture and the lived experience of the more than7220,000 people who work at Microsoft.Essential to this is our commitment to continually exercise our growth mindset andconfront our fixed mindset with humility,curiosity,compassion,and the recognition that,while none o

77、f us will ever beperfect,we can always be better than we are today.This growth mindset served us well through the historic changes of the past few years.It sustains our everyday practice ofcustomer obsession.It helps us care for our colleagues and collaborate more effectively across the company.And

78、itdeeply informs our longstanding commitment to diversity and inclusion.If we want to serve the world,we need to represent the world.Each year we strive to increase representation,and 2022was no exception.We saw the strongest progress in years across several demographic groups,as you can see in ourl

79、atest Diversity&Inclusion Report.We are one of the most transparent companies of our size when it comes to the datawe share,and we continually challenge ourselves to increase visibility into where were succeeding and where we need toaddress gaps.Weve added new data,such as military status,gender rep

80、resentation by geography,employee exits,andadditional pay data,to reflect our workforce more broadly.As we make meaningful progress,we continue our commitmentto meet the increasing expectations for driving innovation,welcoming diverse perspectives,and leading global change.Giving is also core to our

81、 culture at Microsoft.In 2022,our employees gave$255 million(with company match)to over32,000 nonprofits.And more than 29,000 employees volunteered over 720,000 hours to causes they care about.Im constantly in awe of how our employees bring their passion to work each dayfor each other,for our custom

82、ers,andfor their communities.*I want to close by thanking you for your continued investment in Microsoft.Our growth and impact this past year would nothave been possible without your commitment to the company and belief in its mission.The opportunity to apply technology to make a real difference for

83、 every customer,community,and country has neverbeen greater.And I truly believe if we continue to live our mission,embrace our responsibility,and grasp that opportunity,there is no limit to what we can achieve for the world in the year ahead and beyond.Satya NadellaChairman and Chief Executive Offic

84、erOctober 24,20228FINANCIAL REVIEWISSUER PURCHASES OF EQUITY SECURITIES,DIVIDENDS,AND STOCK PERFORMANCEMARKET AND STOCKHOLDERSOur common stock is traded on the NASDAQ Stock Market under the symbol MSFT.On July 25,2022,there were 86,465registered holders of record of our common stock.SHARE REPURCHASE

85、S AND DIVIDENDSShare RepurchasesOn September 20,2016,our Board of Directors approved a share repurchase program authorizing up to$40.0 billion inshare repurchases.This share repurchase program commenced in December 2016 and was completed in February 2020.On September 18,2019,our Board of Directors a

86、pproved a share repurchase program authorizing up to$40.0 billion inshare repurchases.This share repurchase program commenced in February 2020 and was completed in November 2021.On September 14,2021,our Board of Directors approved a share repurchase program authorizing up to$60.0 billion inshare rep

87、urchases.This share repurchase program commenced in November 2021,following completion of the programapproved on September 18,2019,has no expiration date,and may be terminated at any time.As of June 30,2022,$40.7 billion remained of this$60.0 billion share repurchase program.We repurchased the follo

88、wing shares of common stock under the share repurchase programs:(In millions)SharesAmountSharesAmountSharesAmountYear Ended June 30,202220212020First Quarter21$6,20025$5,27029$4,000Second Quarter206,233275,750324,600Third Quarter267,800255,750376,000Fourth Quarter287,800246,200285,088Total95$28,0331

89、01$22,970126$19,688All repurchases were made using cash resources.Shares repurchased during the fourth and third quarters of fiscal year2022 were under the share repurchase program approved on September 14,2021.Shares repurchased during thesecond quarter of fiscal year 2022 were under the share repu

90、rchase programs approved on both September 14,2021 andSeptember 18,2019.Shares repurchased during the first quarter of fiscal year 2022,fiscal year 2021,and the fourthquarter of fiscal year 2020 were under the share repurchase program approved on September 18,2019.Sharesrepurchased during the third

91、quarter of fiscal year 2020 were under the share repurchase programs approved on bothSeptember 20,2016 and September 18,2019.All other shares repurchased were under the share repurchase programapproved on September 20,2016.The above table excludes shares repurchased to settle employee tax withholdin

92、grelated to the vesting of stock awards of$4.7 billion,$4.4 billion,and$3.3 billion for fiscal years 2022,2021,and 2020,respectively.9DividendsOur Board of Directors declared the following dividends:Declaration DateRecord DatePayment DateDividendPer ShareAmountFiscal Year 2022(In millions)September

93、14,2021November 18,2021December 9,2021$0.62$4,652December 7,2021February 17,2022March 10,20220.624,645March 14,2022May 19,2022June 9,20220.624,632June 14,2022August 18,2022September 8,20220.624,627Total$2.48$18,556Fiscal Year 2021September 15,2020November 19,2020December 10,2020$0.56$4,230December 2

94、,2020February 18,2021March 11,20210.564,221March 16,2021May 20,2021June 10,20210.564,214June 16,2021August 19,2021September 9,20210.564,206Total$2.24$16,871The dividend declared on June 14,2022 was included in other current liabilities as of June 30,2022.10STOCK PERFORMANCECOMPARISON OF 5 YEAR CUMUL

95、ATIVE TOTAL RETURN*Among Microsoft Corporation,the S&P 500 Indexand the NASDAQ Computer Index6/176/186/196/206/216/22Microsoft Corporation100.00145.84201.36309.69416.25397.90S&P 500100.00114.37126.29135.77191.15170.86NASDAQ Computer100.00131.27139.29196.40288.13228.71*$100 invested on 6/30/17 in sto

96、ck or index,including reinvestment of dividends.Fiscal year ending June 30.11Note About Forward-Looking StatementsThis report includes estimates,projections,statements relating to our business plans,objectives,and expected operatingresults that are“forward-looking statements”within the meaning of th

97、e Private Securities Litigation Reform Act of 1995,Section 27A of the Securities Act of 1933,and Section 21E of the Securities Exchange Act of 1934.Forward-lookingstatements may appear throughout this report,including the following sections:“Business”in our fiscal year 2022 Form10-K and“Managements

98、Discussion and Analysis of Financial Condition and Results of Operations”in our fiscal year2022 Form 10-K.These forward-looking statements generally are identified by the words“believe,”“project,”“expect,”“anticipate,”“estimate,”“intend,”“strategy,”“future,”“opportunity,”“plan,”“may,”“should,”“will,

99、”“would,”“will be,”“willcontinue,”“will likely result,”and similar expressions.Forward-looking statements are based on current expectations andassumptions that are subject to risks and uncertainties that may cause actual results to differ materially.We describe risksand uncertainties that could caus

100、e actual results and events to differ materially in“Risk Factors,”“ManagementsDiscussion and Analysis of Financial Condition and Results of Operations,”and“Quantitative and Qualitative Disclosuresabout Market Risk in our fiscal year 2022 Form 10-K.Readers are cautioned not to place undue reliance on

101、 forward-looking statements,which speak only as of the date they are made.We undertake no obligation to update or revisepublicly any forward-looking statements,whether because of new information,future events,or otherwise.BUSINESSGENERALEmbracing Our FutureMicrosoft is a technology company whose mis

102、sion is to empower every person and every organization on the planet toachieve more.We strive to create local opportunity,growth,and impact in every country around the world.Our platformsand tools help drive small business productivity,large business competitiveness,and public-sector efficiency.We a

103、recreating the tools and platforms that deliver better,faster,and more effective solutions to support new startups,improveeducational and health outcomes,and empower human ingenuity.Microsoft is innovating and expanding our entire portfolio to help people and organizations overcome todays challenges

104、and emerge stronger.We bring technology and products together into experiences and solutions that unlock value for ourcustomers.In a dynamic environment,digital technology is the key input that powers the worlds economic output.Our ecosystem ofcustomers and partners have learned that while hybrid wo

105、rk is complex,embracing flexibility,different work styles,and aculture of trust can help navigate the challenges the world faces today.Organizations of all sizes have digitized business-critical functions,redefining what they can expect from their business applications.Customers are looking to unloc

106、k valuewhile simplifying security and management.From infrastructure and data,to business applications and collaboration,weprovide unique,differentiated value to customers.We are building a distributed computing fabric across cloud and the edge to help every organization build,run,andmanage mission-

107、critical workloads anywhere.In the next phase of innovation,artificial intelligence(“AI”)capabilities arerapidly advancing,fueled by data and knowledge of the world.We are enabling metaverse experiences at all layers of ourstack,so customers can more effectively model,automate,simulate,and predict c

108、hanges within their industrialenvironments,feel a greater sense of presence in the new world of hybrid work,and create custom immersive worlds toenable new opportunities for connection and experimentation.What We OfferFounded in 1975,we develop and support software,services,devices,and solutions tha

109、t deliver new value for customersand help people and businesses realize their full potential.12We offer an array of services,including cloud-based solutions that provide customers with software,services,platforms,and content,and we provide solution support and consulting services.We also deliver rel

110、evant online advertising to aglobal audience.Our products include operating systems,cross-device productivity and collaboration applications,server applications,business solution applications,desktop and server management tools,software development tools,and video games.Wealso design and sell device

111、s,including PCs,tablets,gaming and entertainment consoles,other intelligent devices,andrelated accessories.The Ambitions That Drive UsTo achieve our vision,our research and development efforts focus on three interconnected ambitions:Reinvent productivity and business processes.Build the intelligent

112、cloud and intelligent edge platform.Create more personal computing.Reinvent Productivity and Business ProcessesAt Microsoft,we provide technology and resources to help our customers create a secure hybrid work environment.Ourfamily of products plays a key role in the ways the world works,learns,and

113、connects.Our growth depends on securely delivering continuous innovation and advancing our leading productivity andcollaboration tools and services,including Office 365,Dynamics 365,and LinkedIn.Microsoft 365 brings together Office365,Windows,and Enterprise Mobility+Security to help organizations em

114、power their employees with AI-backed toolsthat unlock creativity,increase collaboration,and fuel innovation,all the while enabling compliance coverage and dataprotection.Microsoft Teams is a comprehensive platform for work,with meetings,calls,chat,collaboration,and businessprocess automation.Microso

115、ft Viva is an employee experience platform that brings together communications,knowledge,learning,resources,and insights powered by Microsoft 365.Together with the Microsoft Cloud,Dynamics 365,MicrosoftTeams,and Azure Synapse bring a new era of collaborative applications that transform every busines

116、s function andprocess.Microsoft Power Platform is helping domain experts drive productivity gains with low-code/no-code tools,roboticprocess automation,virtual agents,and business intelligence.In a dynamic labor market,LinkedIn is helpingprofessionals use the platform to connect,learn,grow,and get h

117、ired.Build the Intelligent Cloud and Intelligent Edge PlatformAs digital transformation accelerates,organizations in every sector across the globe can address challenges that will havea fundamental impact on their success.For enterprises,digital technology empowers employees,optimizes operations,eng

118、ages customers,and in some cases,changes the very core of products and services.Microsoft has a proven trackrecord of delivering high value to our customers across many diverse and durable growth markets.We continue to invest in high performance and sustainable computing to meet the growing demand f

119、or fast access toMicrosoft services provided by our network of cloud computing infrastructure and datacenters.Azure is a trusted cloudwith comprehensive compliance coverage and AI-based security built in.Our cloud business benefits from three economies of scale:datacenters that deploy computational

120、resources atsignificantly lower cost per unit than smaller ones;datacenters that coordinate and aggregate diverse customer,geographic,and application demand patterns,improving the utilization of computing,storage,and network resources;andmulti-tenancy locations that lower application maintenance lab

121、or costs.13The Microsoft Cloud is the most comprehensive and trusted cloud,providing the best integration across the technologystack while offering openness,improving time to value,reducing costs,and increasing agility.Being a global-scale cloud,Azure uniquely offers hybrid consistency,developer pro

122、ductivity,AI capabilities,and trusted security and compliance.Wesee more emerging use cases and needs for compute and security at the edge and are accelerating our innovation acrossthe spectrum of intelligent edge devices,from Internet of Things(“IoT”)sensors to gateway devices and edge hardware tob

123、uild,manage,and secure edge workloads.With Azure Stack,organizations can extend Azure into their own datacentersto create a consistent stack across the public cloud and the intelligent edge.Our hybrid infrastructure consistency spans security,compliance,identity,and management,helping to support the

124、 real-world needs and evolving regulatory requirements of commercial customers and enterprises.Our industry clouds bringtogether capabilities across the entire Microsoft Cloud,along with industry-specific customizations,to improve time tovalue,increase agility,and lower costs.Azure Arc simplifies go

125、vernance and management by delivering a consistentmulti-cloud and on-premises management platform.Security,compliance,identity,and management underlie our entiretech stack.We offer integrated,end-to-end capabilities to protect people and organizations.In March 2022,we completed our acquisition of Nu

126、ance Communications,Inc.(“Nuance”).Together,Microsoft andNuance will enable organizations across industries to accelerate their business goals with security-focused,cloud-basedsolutions infused with powerful,vertically optimized AI.We are accelerating our development of mixed reality solutions with

127、new Azure services and devices.Microsoft Meshenables presence and shared experiences from anywhere through mixed reality applications.The opportunity to mergethe physical and digital worlds,when combined with the power of Azure cloud services,unlocks new workloads andexperiences to create common und

128、erstanding and drive more informed decisions.The ability to convert data into AI drives our competitive advantage.Azure SQL Database makes it possible for customersto take SQL Server from their on-premises datacenter to a fully managed instance in the cloud to utilize built-in AI.AzureSynapse brings

129、 together data integration,enterprise data warehousing,and big data analytics in a comprehensivesolution.We are accelerating adoption of AI innovations from research to products.Our innovation helps every developerbe an AI developer,with approachable new tools from Azure Machine Learning Studio for

130、creating simple machinelearning models,to the powerful Azure Machine Learning Workbench for the most advanced AI modeling and datascience.From GitHub to Visual Studio,we provide a developer tool chain for everyone,no matter the technicalexperience,across all platforms,whether Azure,Windows,or any ot

131、her cloud or client platform.Additionally,we are extending our infrastructure beyond the planet,bringing cloud computing to space.Azure Orbital is afully managed ground station as a service for fast downlinking of data.Create More Personal ComputingWe strive to make computing more personal by puttin

132、g people at the core of the experience,enabling them to interact withtechnology in more intuitive,engaging,and dynamic ways.Microsoft 365 is empowering people and organizations to beproductive and secure as they adapt to more fluid ways of working,learning,and playing.Windows also plays a criticalro

133、le in fueling our cloud business with Windows 365,a desktop operating system thats also a cloud service.From anotherinternet-connected device,including Android or macOS devices,you can run Windows 365,just like a virtual machine.With Windows 11,we have simplified the design and experience to empower

134、 productivity and inspire creativity.Windows11 offers innovations focused on enhancing productivity and is designed to support hybrid work.It adds new experiencesthat include powerful task switching tools like new snap layouts,snap groups,and desktops;new ways to stay connectedthrough Microsoft Team

135、s chat;the information you want at your fingertips;and more.Windows 11 security and privacyfeatures include operating system security,application security,and user and identity security.14Tools like search,news,and maps have given us immediate access to the worlds information.Today,through our Searc

136、h,News,Mapping,and Browse services,Microsoft delivers unique trust,privacy,and safety features.Microsoft Edge is ourfast and secure browser that helps protect your data,with built-in shopping tools designed to save you time and money.Organizational tools such as Collections,Vertical Tabs,and Immersi

137、ve Reader help make the most of your time whilebrowsing,streaming,searching,and sharing.We are committed to designing and marketing first-party devices to help drive innovation,create new device categories,and stimulate demand in the Windows ecosystem.The Surface family includes Surface Laptop Studi

138、o,Surface Laptop 4,Surface Laptop Go 2,Surface Laptop Pro 8,Surface Pro X,Surface Go 3,Surface Studio 2,and Surface Duo 2.With three billion people actively playing games today,and a new generation steeped in interactive entertainment,Microsoft continues to invest in content,community,and cloud serv

139、ices.We have broadened our approach to how wethink about gaming end-to-end,from the way games are created and distributed to how they are played,including cloudgaming so players can stream across PC,console,and mobile.We have a strong position with our large and growinghighly engaged community of ga

140、mers,including the acquisition of ZeniMax Media Inc.,the parent company of BethesdaSoftworks LLC.In January 2022,we announced plans to acquire Activision Blizzard,Inc.,a leader in game developmentand an interactive entertainment content publisher.Xbox Game Pass is a community with access to a curate

141、d library ofover 100 first-and third-party console and PC titles.Xbox Cloud Gaming is Microsofts game streaming technology that iscomplementary to our console hardware and gives fans the ultimate choice to play the games they want,with the peoplethey want,on the devices they want.Our Future Opportun

142、ityThe case for digital transformation has never been more urgent.Customers are looking to us to help improve productivityand the affordability of their products and services.We continue to develop complete,intelligent solutions for ourcustomers that empower people to stay productive and collaborate

143、,while safeguarding businesses and simplifying ITmanagement.Our goal is to lead the industry in several distinct areas of technology over the long term,which we expectwill translate to sustained growth.We are investing significant resources in:Transforming the workplace to deliver new modern,modular

144、 business applications,drive deeper insights,andimprove how people communicate,collaborate,learn,work,play,and interact with one another.Building and running cloud-based services in ways that unleash new experiences and opportunities forbusinesses and individuals.Applying AI to drive insights and ac

145、t on our customers behalf by understanding and interpreting their needsusing natural methods of communication.Tackling security from all angles with our integrated,end-to-end solutions spanning security,compliance,identity,and management,across all clouds and platforms.Inventing new gaming experienc

146、es that bring people together around their shared love for games on anydevices and pushing the boundaries of innovation with console and PC gaming by creating the next wave ofentertainment.Using Windows to fuel our cloud business,grow our share of the PC market,and drive increasedengagement with our

147、 services like Microsoft 365 Consumer,Teams,Edge,Bing,Xbox Game Pass,and more.Our future growth depends on our ability to transcend current product category definitions,business models,and salesmotions.We have the opportunity to redefine what customers and partners can expect and are working to deli

148、ver newsolutions that reflect the best of Microsoft.15Corporate Social ResponsibilityCommitment to SustainabilityWe work to ensure that technology is inclusive,trusted,and increases sustainability.We are accelerating progress towarda more sustainable future by reducing our environmental footprint,ad

149、vancing research,helping our customers buildsustainable solutions,and advocating for policies that benefit the environment.In January 2020,we announced a boldcommitment and detailed plan to be carbon negative by 2030,and to remove from the environment by 2050 all the carbonwe have emitted since our

150、founding in 1975.This included a commitment to invest$1 billion over four years in newtechnologies and innovative climate solutions.We built on this pledge by adding commitments to be water positive by2030,zero waste by 2030,and to protect ecosystems by developing a Planetary Computer.We also help o

151、ur suppliersand customers around the world use Microsoft technology to reduce their own carbon footprint.Fiscal year 2021 was a year of both successes and challenges.While we continued to make progress on several of ourgoals,with an overall reduction in our combined Scope 1 and Scope 2 emissions,our

152、 Scope 3 emissions increased,duein substantial part to significant global datacenter expansions and growth in Xbox sales and usage as a result of theCOVID-19 pandemic.Despite these Scope 3 increases,we will continue to build the foundations and do the work todeliver on our commitments,and help our c

153、ustomers and partners achieve theirs.We have learned the impact of our workwill not all be felt immediately,and our experience highlights how progress wont always be linear.While fiscal year 2021 presented us with some new learnings,we also made some great progress.A few examples thatilluminate the

154、diversity of our work include:We purchased the removal of 1.4 million metrics tons of carbon.Four of our datacenters received new or renewed Zero Waste certifications.We granted$100 million to Breakthrough Energy Catalyst to accelerate the development of climate solutionsthe world needs to reach net

155、-zero across four key areas:direct air capture,green hydrogen,long durationenergy storage,and sustainable aviation fuel.We joined the First Movers Coalition as an early leader and expert partner in the carbon dioxide removalsector,with a commitment of$200 million toward carbon removal by 2030.Sustai

156、nability is an existential priority for our society and businesses today.This led us to create our Microsoft Cloud forSustainability,an entirely new business process category to help organizations monitor their carbon footprint across theiroperations.We also joined with leading organizations to laun

157、ch the Carbon Call an initiative to mobilize collective actionto solve carbon emissions and removal accounting challenges for a net zero future.The investments we make in sustainability carry through to our products,services,and devices.We design our devices,from Surface to Xbox,to minimize their im

158、pact on the environment.Our cloud and AI services and datacenters helpbusinesses cut energy consumption,reduce physical footprints,and design sustainable products.Addressing Racial Injustice and InequityWe are committed to addressing racial injustice and inequity in the United States for Black and A

159、frican Americancommunities and helping improve lived experiences at Microsoft,in employees communities,and beyond.Our RacialEquity Initiative focuses on three multi-year pillars,each containing actions and progress we expect to make or exceed by2025.Strengthening our communities:using data,technolog

160、y,and partnerships to help improve the lives of Blackand African American people in the United States,including our employees and their communities.Evolving our ecosystem:using our balance sheet and relationships with suppliers and partners to fostersocietal change and create new opportunities.16Inc

161、reasing representation and strengthening inclusion:build on our momentum,adding a$150 millioninvestment to strengthen inclusion and double the number of Black,African American,Hispanic,and Latinxleaders in the United States by 2025.Over the last year,we collaborated with partners and worked within n

162、eighborhoods and communities to launch and scalea number of projects and programs,including:working with 70 organizations in 145 communities on the Justice ReformInitiative,expanding access to affordable broadband and devices for Black and African American communities and keyinstitutions that suppor

163、t them in major urban centers,expanding access to skills and education to support Black andAfrican American students and adults to succeed in the digital economy,and increasing technology support for nonprofitsthat provide critical services to Black and African American communities.We have made mean

164、ingful progress on representation and inclusion at Microsoft.We are 90 percent of the way to our2025 commitment to double the number of Black and African American people managers,senior individual contributors,and senior leaders in the U.S.,and 50 percent of the way for Hispanic and Latinx people ma

165、nagers,senior individualcontributors,and senior leaders in the U.S.We exceeded our goal on increasing the percentage of transaction volumes with Black-and African American-ownedfinancial institutions and increased our deposits with Black-and African American-owned minority depository institutions,en

166、abling increased funds into local communities.Additionally,we enriched our supplier pipeline,reaching more than90 percent of our goal to spend$500 million with double the number of Black and African American-owned suppliers.Wealso increased the number of identified partners in the Black Partner Grow

167、th Initiative and continue to invest in the partnercommunity through the Black Channel Partner Alliance by supporting events focused on business growth,accelerators,and mentorship.Progress does not undo the egregious injustices of the past or diminish those who continue to live with inequity.We arec

168、ommitted to leveraging our resources to help accelerate diversity and inclusion across our ecosystem and to holdourselves accountable to accelerate change for Microsoft,and beyond.Investing in Digital SkillsThe COVID-19 pandemic led to record unemployment,disrupting livelihoods of people around the

169、world.After helpingover 30 million people in 249 countries and territories with our global skills initiative,we introduced a new initiative tosupport a more skills-based labor market,with greater flexibility and accessible learning paths to develop the right skillsneeded for the most in-demand jobs.

170、Our skills initiative brings together learning resources,certification opportunities,andjob-seeker tools from LinkedIn,GitHub,and Microsoft Learn,and is built on data insights drawn from LinkedIns EconomicGraph.We previously invested$20 million in key non-profit partnerships through Microsoft Philan

171、thropies to help peoplefrom underserved communities that are often excluded by the digital economy.We also launched a national campaign with U.S.community colleges to help skill and recruit into the cybersecurityworkforce 250,000 people by 2025,representing half of the countrys workforce shortage.To

172、 that end,we are makingcurriculum available free of charge to all of the nations public community colleges,providing training for new and existingfaculty at 150 community colleges,and providing scholarships and supplemental resources to 25,000 students.HUMAN CAPITAL RESOURCESOverviewMicrosoft aims t

173、o recruit,develop,and retain world-changing talent from a diversity of backgrounds.To foster their andour success,we seek to create an environment where people can thrive,where they can do their best work,where theycan proudly be their authentic selves,guided by our values,and where they know their

174、needs can be met.We strive tomaximize the potential of our human capital resources by creating a respectful,rewarding,and inclusive workenvironment that enables our global employees to create products and services that further our mission to empower everyperson and every organization on the planet t

175、o achieve more.17As of June 30,2022,we employed approximately 221,000 people on a full-time basis,122,000 in the U.S.and 99,000internationally.Of the total employed people,85,000 were in operations,including manufacturing,distribution,productsupport,and consulting services;73,000 were in product res

176、earch and development;47,000 were in sales and marketing;and 16,000 were in general and administration.Certain employees are subject to collective bargaining agreements.Our CultureMicrosofts culture is grounded in the growth mindset.This means everyone is on a continuous journey to learn and grow.We

177、 believe potential can be nurtured and is not pre-determined,and we should always be learning and curious tryingnew things without fear of failure.We identified four attributes that allow growth mindset to flourish:Obsessing over what matters to our customers.Becoming more diverse and inclusive in e

178、verything we do.Operating as one company,One Microsoft,instead of multiple siloed businesses.Making a difference in the lives of each other,our customers,and the world around us.Our employee listening systems enable us to gather feedback directly from our workforce to inform our programs andemployee

179、 needs globally.Seventy percent of employees globally participated in our fiscal year 2022 Employee Signalssurvey,which covers a variety of topics such as thriving,inclusion,team culture,wellbeing,and learning and development.Throughout the fiscal year,we collect over 75,000 Daily Pulse employee sur

180、vey responses.During fiscal year 2022,ourDaily Pulse surveys gave us invaluable insights into ways we could support employees through the COVID-19 pandemic,addressing racial injustice,the war in Ukraine,and their general wellbeing.In addition to Employee Signals and DailyPulse surveys,we gain insigh

181、ts through onboarding,internal mobility,leadership,performance and development,exitsurveys,internal Yammer channels,employee Q&A sessions,and AskHR Service support.Diversity and InclusionAt Microsoft we have an inherently inclusive mission:to empower every person and every organization on the planet

182、 toachieve more.We think of diversity and inclusion as core to our business model,informing our actions to impacteconomies and people around the world.There are billions of people who want to achieve more,but have a different setof circumstances,abilities,and backgrounds that often limit access to o

183、pportunity and achievement.The better werepresent that diversity inside Microsoft,the more effectively we can innovate for those we seek to empower.We strive to include others by holding ourselves accountable for diversity,driving global systemic change in our workplaceand workforce,and creating an

184、inclusive work environment.Through this commitment we can allow everyone the chanceto be their authentic selves and do their best work every day.We support multiple highly active Employee ResourceGroups for women,families,racial and ethnic minorities,military,people with disabilities,and employees w

185、ho identify asLGBTQIA+,where employees can go for support,networking,and community-building.As described in our 2021 ProxyStatement,annual performance and compensation reviews of our senior leadership team include an evaluation of theircontributions to employee culture and diversity.To ensure accoun

186、tability over time,we publicly disclose our progress on amultitude of workforce metrics including:Detailed breakdowns of gender,racial,and ethnic minority representation in our employee population,withdata by job types,levels,and segments of our business.Our EEO-1 report(equal employment opportunity

187、).Disability representation.Pay equity(see details below).18Total RewardsWe develop dynamic,sustainable,market-driven,and strategic programs with the goal of providing a highly differentiatedportfolio to attract,reward,and retain top talent and enable our employees to thrive.These programs reinforce

188、 our cultureand values such as collaboration and growth mindset.Managers evaluate and recommend rewards based on,forexample,how well we leverage the work of others and contribute to the success of our colleagues.We monitor pay equityand career progress across multiple dimensions.As part of our effor

189、t to promote a One Microsoft and inclusive culture,in fiscal year 2021 we expanded stock eligibility toall Microsoft employees as part of our annual rewards process.This includes all non-exempt and exempt employees andequivalents across the globe including business support professionals and datacent

190、er and retail employees.In responseto the Great Reshuffle,in fiscal year 2022 we announced a sizable investment in annual merit and annual stock awardopportunity for all employees below senior executive levels.We also invested in base salary adjustments for ourdatacenter and retail hourly employees

191、and hourly equivalents outside the U.S.These investments have supportedretention and help to ensure that Microsoft remains an employer of choice.Pay EquityIn our 2021 Diversity and Inclusion Report,we reported that all racial and ethnic minority employees in the U.S.combinedearn$1.006 for every$1.00

192、0 earned by their white counterparts,that women in the U.S.earn$1.002 for every$1.000earned by their counterparts in the U.S.who are men,and women in the U.S.plus our twelve other largest employeegeographies representing 86.6%of our global population(Australia,Canada,China,France,Germany,India,Irela

193、nd,Israel,Japan,Romania,Singapore,and the United Kingdom)combined earn$1.001 for every$1.000 by men in thesecountries.Our intended result is a global performance and development approach that fosters our culture,and competitivecompensation that ensures equitable pay by role while supporting pay for

194、performance.Wellness and SafetyMicrosoft is committed to supporting our employees well-being and safety while they are at work and in their personallives.We took a wide variety of measures to protect the health and well-being of our employees,suppliers,and customersduring the COVID-19 pandemic and a

195、re now supporting employees in shifting to return to office and/or hybridarrangements.We developed hybrid guidelines for managers and employees to support the transition and continue toidentify ways we can support hybrid work scenarios through our employee listening systems.We have invested signific

196、antly in holistic wellbeing,and offer a differentiated benefits package which includes manyphysical,emotional,and financial wellness programs including counseling through the Microsoft CARES EmployeeAssistance Program,mental wellbeing support,flexible fitness benefits,savings and investment tools,ad

197、option assistance,and back-up care for children and elders.Finally,our Occupational Health and Safety program helps ensure employeescan stay safe while they are working.We continue to strive to support our Ukrainian employees and their dependents during the Ukraine crisis with emergencyrelocation as

198、sistance,emergency leave,and other benefits.Learning and DevelopmentOur growth mindset culture begins with valuing learning over knowing seeking out new ideas,driving innovation,embracing challenges,learning from failure,and improving over time.To support this culture,we offer a wide range oflearnin

199、g and development opportunities.We believe learning can be more than formal instruction,and our learningphilosophy focuses on providing the right learning,at the right time,in the right way.Opportunities include:Personalized,integrated,and relevant views of all learning opportunities on both our int

200、ernal learning portalLearning(Viva Learning+LinkedIn Learning)and our external learning portal MS Learn are available to allemployees worldwide.19In-the-classroom learning,learning cohorts,our early-in-career Aspire program,and manager excellencecommunities.Required learning for all employees and ma

201、nagers on topics such as compliance,regulation,companyculture,leadership,and management.This includes the annual Standards of Business Conduct training.On-the-job“stretch”and advancement opportunities.Managers holding conversations about employees career and development plans,coaching on careeroppor

202、tunities,and programs like mentoring and sponsorship.Customized manager learning to build people manager capabilities and similar learning solutions to buildleadership skills for all employees including differentiated leadership development programs.New employee orientation covering a range of topic

203、s including company values,and culture,as well asongoing onboarding programs.New tools to assist managers and employees in learning how to operate,be productive,and connect in thenew flexible hybrid world of work.These include quick guides for teams to use,such as Creating TeamAgreements,Reconnectin

204、g as a Team,and Running Effective Hybrid Meetings.Our employees embrace the growth mindset and take advantage of the formal learning opportunities as well as thousandsof informal and on-the-job learning opportunities.In terms of formal on-line learning solutions,in fiscal year 2022 ouremployees comp

205、leted over 4.7 million courses,averaging over 14 hours per employee.Given our focus on understandingcore company beliefs and compliance topics,all employees complete required learning programs like Standards ofBusiness Conduct,Privacy,Unconscious Bias,and preventing harassment courses.Our corporate

206、learning portal hasover 100,000 average monthly active users.We have over 27,000 people managers,all of whom must complete between20-33 hours of required manager capability and excellence training and are assigned ongoing required training each year.In addition,all employees complete skills training

207、 based on the profession they are in each year.New Ways of WorkingThe COVID-19 pandemic accelerated our capabilities and culture with respect to flexible work.We introduced a HybridWorkplace Flexibility Guide to better support managers and employees as they adapt to new ways of working that shiftpar

208、adigms,embrace flexibility,promote inclusion,and drive innovation.Our ongoing survey data shows employees valuethe flexibility related to work location,work site,and work hours,and while many have begun returning to worksites asconditions have permitted,they also continue to adjust hours and/or spen

209、d some of workweeks working at home,anothersite,or remotely.We are focused on building capabilities to support a variety of workstyles where individuals,teams,andour business can deliver success.OPERATING SEGMENTSWe operate our business and report our financial performance using three segments:Produ

210、ctivity and BusinessProcesses,Intelligent Cloud,and More Personal Computing.Our segments provide management with a comprehensivefinancial view of our key businesses.The segments enable the alignment of strategies and objectives across thedevelopment,sales,marketing,and services organizations,and the

211、y provide a framework for timely and rationalallocation of resources within businesses.Additional information on our operating segments and geographic and product information is contained in Note 19 Segment Information and Geographic Data of the Notes to Financial Statements in our fiscal year 2022

212、Form 10-K.Our reportable segments are described below.20Productivity and Business ProcessesOur Productivity and Business Processes segment consists of products and services in our portfolio of productivity,communication,and information services,spanning a variety of devices and platforms.This segmen

213、t primarily comprises:Office Commercial(Office 365 subscriptions,the Office 365 portion of Microsoft 365 Commercialsubscriptions,and Office licensed on-premises),comprising Office,Exchange,SharePoint,Microsoft Teams,Office 365 Security and Compliance,and Microsoft Viva.Office Consumer,including Micr

214、osoft 365 Consumer subscriptions,Office licensed on-premises,and otherOffice services.LinkedIn,including Talent Solutions,Marketing Solutions,Premium Subscriptions,and Sales Solutions.Dynamics business solutions,including Dynamics 365,comprising a set of intelligent,cloud-basedapplications across ER

215、P,CRM,Customer Insights,Power Apps,and Power Automate;and on-premises ERPand CRM applications.Office CommercialOffice Commercial is designed to increase personal,team,and organizational productivity through a range of productsand services.Growth depends on our ability to reach new users in new marke

216、ts such as frontline workers,small andmedium businesses,and growth markets,as well as add value to our core product and service offerings to spanproductivity categories such as communication,collaboration,analytics,security,and compliance.Office Commercialrevenue is mainly affected by a combination

217、of continued installed base growth and average revenue per user expansion,as well as the continued shift from Office licensed on-premises to Office 365.Office ConsumerOffice Consumer is designed to increase personal productivity through a range of products and services.Growth dependson our ability t

218、o reach new users,add value to our core product set,and continue to expand our product and serviceofferings into new markets.Office Consumer revenue is mainly affected by the percentage of customers that buy Officewith their new devices and the continued shift from Office licensed on-premises to Mic

219、rosoft 365 Consumer subscriptions.Office Consumer Services revenue is mainly affected by the demand for communication and storage through Skype,O,and OneDrive,which is largely driven by subscriptions,advertising,and the sale of minutes.LinkedInLinkedIn connects the worlds professionals to make them

220、more productive and successful and transforms the waycompanies hire,market,sell,and learn.Our vision is to create economic opportunity for every member of the globalworkforce through the ongoing development of the worlds first Economic Graph,a digital representation of the globaleconomy.In addition

221、to LinkedIns free services,LinkedIn offers monetized solutions:Talent Solutions,MarketingSolutions,Premium Subscriptions,and Sales Solutions.Talent Solutions provide insights for workforce planning and toolsto hire,nurture,and develop talent.Talent Solutions also includes Learning Solutions,which he

222、lp businesses close criticalskills gaps in times where companies are having to do more with existing talent.Marketing Solutions help companiesreach,engage,and convert their audiences at scale.Premium Subscriptions enables professionals to manage theirprofessional identity,grow their network,and conn

223、ect with talent through additional services like premium search.SalesSolutions help companies strengthen customer relationships,empower teams with digital selling tools,and acquire newopportunities.LinkedIn has over 850 million members and has offices around the globe.Growth will depend on our abili

224、tyto increase the number of LinkedIn members and our ability to continue offering services that provide value for ourmembers and increase their engagement.LinkedIn revenue is mainly affected by demand from enterprises andprofessional organizations for subscriptions to Talent Solutions,Sales Solution

225、s,and Premium Subscriptions offerings,aswell as member engagement and the quality of the sponsored content delivered to those members to drive MarketingSolutions.21DynamicsDynamics provides cloud-based and on-premises business solutions for financial management,enterprise resourceplanning(“ERP”),cus

226、tomer relationship management(“CRM”),supply chain management,and other applicationdevelopment platforms for small and medium businesses,large organizations,and divisions of global enterprises.Dynamics revenue is driven by the number of users licensed and applications consumed,expansion of average re

227、venueper user,and the continued shift to Dynamics 365,a unified set of cloud-based intelligent business applications,includingPower Apps and Power Automate.CompetitionCompetitors to Office include software and global application vendors,such as Apple,Cisco Systems,Meta,Google,IBM,Okta,Proofpoint,Sla

228、ck,Symantec,Zoom,and numerous web-based and mobile application competitors as well as localapplication developers.Apple distributes versions of its pre-installed application software,such as email and calendarproducts,through its PCs,tablets,and phones.Cisco Systems is using its position in enterpri

229、se communicationsequipment to grow its unified communications business.Google provides a hosted messaging and productivity suite.Slack provides teamwork and collaboration software.Zoom offers videoconferencing and cloud phone solutions.Okta,Proofpoint,and Symantec provide security solutions across e

230、mail security,information protection,identity,andgovernance.Web-based offerings competing with individual applications have also positioned themselves as alternativesto our products and services.We compete by providing powerful,flexible,secure,integrated industry-specific,and easy-to-use productivit

231、y and collaboration tools and services that create comprehensive solutions and work well withtechnologies our customers already have both on-premises or in the cloud.LinkedIn faces competition from online professional networks,recruiting companies,talent management companies,andlarger companies that

232、 are focusing on talent management and human resource services;job boards;traditional recruitingfirms;and companies that provide learning and development products and services.Marketing Solutions competes withonline and offline outlets that generate revenue from advertisers and marketers,and Sales S

233、olutions competes with onlineand offline outlets for companies with lead generation and customer intelligence and insights.Dynamics competes with cloud-based and on-premises business solution providers such as Oracle,Salesforce,and SAP.Intelligent CloudOur Intelligent Cloud segment consists of our p

234、ublic,private,and hybrid server products and cloud services that canpower modern business and developers.This segment primarily comprises:Server products and cloud services,including Azure and other cloud services;SQL Server,Windows Server,Visual Studio,System Center,and related Client Access Licens

235、es(“CALs”);and Nuance and GitHub.Enterprise Services,including Enterprise Support Services,Microsoft Consulting Services,and Nuanceprofessional services.Server Products and Cloud ServicesAzure is a comprehensive set of cloud services that offer developers,IT professionals,and enterprises freedom to

236、build,deploy,and manage applications on any platform or device.Customers can use Azure through our global network ofdatacenters for computing,networking,storage,mobile and web application services,AI,IoT,cognitive services,andmachine learning.Azure enables customers to devote more resources to devel

237、opment and use of applications that benefittheir organizations,rather than managing on-premises hardware and software.Azure revenue is mainly affected byinfrastructure-as-a-service and platform-as-a-service consumption-based services,and per user-based services such asEnterprise Mobility+Security.22

238、Our server products are designed to make IT professionals,developers,and their systems more productive and efficient.Server software is integrated server infrastructure and middleware designed to support software applications built on theWindows Server operating system.This includes the server platf

239、orm,database,business intelligence,storage,management and operations,virtualization,service-oriented architecture platform,security,and identity software.We alsolicense standalone and software development lifecycle tools for software architects,developers,testers,and projectmanagers.GitHub provides

240、a collaboration platform and code hosting service for developers.Server products revenue ismainly affected by purchases through volume licensing programs,licenses sold to original equipment manufacturers(“OEM”),and retail packaged products.CALs provide access rights to certain server products,includ

241、ing SQL Server andWindows Server,and revenue is reported along with the associated server product.Nuance and GitHub include both cloud and on-premises offerings.Nuance provides healthcare and enterprise AIsolutions.GitHub provides a collaboration platform and code hosting service for developers.Ente

242、rprise ServicesEnterprise Services,including Enterprise Support Services,Microsoft Consulting Services,and Nuance ProfessionalServices,assist customers in developing,deploying,and managing Microsoft server solutions,Microsoft desktop solutions,and Nuance conversational AI and ambient intelligent sol

243、utions,along with providing training and certification todevelopers and IT professionals on various Microsoft products.CompetitionAzure faces diverse competition from companies such as Amazon,Google,IBM,Oracle,VMware,and open sourceofferings.Our Enterprise Mobility+Security offerings also compete wi

244、th products from a range of competitors includingidentity vendors,security solution vendors,and numerous other security point solution vendors.Azures competitiveadvantage includes enabling a hybrid cloud,allowing deployment of existing datacenters with our public cloud into asingle,cohesive infrastr

245、ucture,and the ability to run at a scale that meets the needs of businesses of all sizes andcomplexities.We believe our clouds global scale,coupled with our broad portfolio of identity and security solutions,allowsus to effectively solve complex cybersecurity challenges for our customers and differe

246、ntiates us from the competition.Our server products face competition from a wide variety of server operating systems and applications offered bycompanies with a range of market approaches.Vertically integrated computer manufacturers such as Hewlett-Packard,IBM,and Oracle offer their own versions of

247、the Unix operating system preinstalled on server hardware.Nearly allcomputer manufacturers offer server hardware for the Linux operating system and many contribute to Linux operatingsystem development.The competitive position of Linux has also benefited from the large number of compatibleapplication

248、s now produced by many commercial and non-commercial software developers.A number of companies,suchas Red Hat,supply versions of Linux.We compete to provide enterprise-wide computing solutions and point solutions with numerous commercial softwarevendors that offer solutions and middleware technology

249、 platforms,software applications for connectivity(both Internet andintranet),security,hosting,database,and e-business servers.IBM and Oracle lead a group of companies focused on theJava Platform Enterprise Edition that competes with our enterprise-wide computing solutions.Commercial competitors foro

250、ur server applications for PC-based distributed client-server environments include CA Technologies,IBM,and Oracle.Our web application platform software competes with open source software such as Apache,Linux,MySQL,and PHP.Inmiddleware,we compete against Java vendors.Our database,business intelligenc

251、e,and data warehousing solutions offerings compete with products from IBM,Oracle,SAP,Snowflake,and other companies.Our system management solutions compete with server management and servervirtualization platform providers,such as BMC,CA Technologies,Hewlett-Packard,IBM,and VMware.Our products forsof

252、tware developers compete against offerings from Adobe,IBM,Oracle,and other companies,and also against open-source projects,including Eclipse(sponsored by CA Technologies,IBM,Oracle,and SAP),PHP,and Ruby on Rails.23We believe our server products provide customers with advantages in performance,total

253、costs of ownership,andproductivity by delivering superior applications,development tools,compatibility with a broad base of hardware andsoftware applications,security,and manageability.Our Enterprise Services business competes with a wide range of companies that provide strategy and business plannin

254、g,application development,and infrastructure services,including multinational consulting firms and small niche businessesfocused on specific technologies.More Personal ComputingOur More Personal Computing segment consists of products and services that put customers at the center of theexperience wit

255、h our technology.This segment primarily comprises:Windows,including Windows OEM licensing(“Windows OEM”)and other non-volume licensing of theWindows operating system;Windows Commercial,comprising volume licensing of the Windows operatingsystem,Windows cloud services,and other Windows commercial offe

256、rings;patent licensing;and WindowsInternet of Things.Devices,including Surface and PC accessories.Gaming,including Xbox hardware and Xbox content and services,comprising first-and third-party content(including games and in-game content),Xbox Game Pass and other subscriptions,Xbox Cloud Gaming,third-

257、party disc royalties,advertising,and other cloud services.Search and news advertising.WindowsThe Windows operating system is designed to deliver a more personal computing experience for users by enablingconsistency of experience,applications,and information across their devices.Windows OEM revenue i

258、s impactedsignificantly by the number of Windows operating system licenses purchased by OEMs,which they pre-install on thedevices they sell.In addition to computing device market volume,Windows OEM revenue is impacted by:The mix of computing devices based on form factor and screen size.Differences i

259、n device market demand between developed markets and growth markets.Attachment of Windows to devices shipped.Customer mix between consumer,small and medium businesses,and large enterprises.Changes in inventory levels in the OEM channel.Pricing changes and promotions,pricing variation that occurs whe

260、n the mix of devices manufactured shiftsfrom local and regional system builders to large multinational OEMs,and different pricing of Windowsversions licensed.Constraints in the supply chain of device components.Piracy.Windows Commercial revenue,which includes volume licensing of the Windows operatin

261、g system and Windows cloudservices such as Microsoft Defender for Endpoint,is affected mainly by the demand from commercial customers forvolume licensing and Software Assurance(“SA”),as well as advanced security offerings.Windows Commercial revenueoften reflects the number of information workers in

262、a licensed enterprise and is relatively independent of the number ofPCs sold in a given year.Patent licensing includes our programs to license patents we own for use across a broad array of technology areas,including mobile devices and cloud offerings.Windows IoT extends the power of Windows and the

263、 cloud to intelligent systems by delivering specialized operatingsystems,tools,and services for use in embedded devices.24DevicesWe design and sell devices,including Surface and PC accessories.Our devices are designed to enable people andorganizations to connect to the people and content that matter

264、 most using Windows and integrated Microsoft products andservices.Surface is designed to help organizations,students,and consumers be more productive.Growth in Devices isdependent on total PC shipments,the ability to attract new customers,our product roadmap,and expanding into newcategories.GamingOu

265、r gaming platform is designed to provide a variety of entertainment through a unique combination of content,community,and cloud.Our exclusive game content is created through Xbox Game Studios,a collection of first-partystudios creating iconic and differentiated gaming experiences.We continue to inve

266、st in new gaming studios and content toexpand our IP roadmap and leverage new content creators.These unique gaming experiences are the cornerstone ofXbox Game Pass,a subscription service and gaming community with access to a curated library of over 100 first-andthird-party console and PC titles.The

267、gamer remains at the heart of the Xbox ecosystem.We continue to open new opportunities for gamers to engageboth on-and off-console with both the launch of Xbox Cloud Gaming,our game streaming service,and continuedinvestment in gaming hardware.Xbox Cloud Gaming utilizes Microsofts Azure cloud technol

268、ogy to allow direct and on-demand streaming of games to PCs,consoles,and mobile devices,enabling gamers to take their favorite games withthem and play on the device most convenient to them.Xbox enables people to connect and share online gaming experiences that are accessible on Xbox consoles,Windows

269、-enabled devices,and other devices.Xbox is designed to benefit users by providing access to a network of certifiedapplications and services and to benefit our developer and partner ecosystems by providing access to a large customerbase.Xbox revenue is mainly affected by subscriptions and sales of fi

270、rst-and third-party content,as well as advertising.Growth of our Gaming business is determined by the overall active user base through Xbox enabled content,availabilityof games,providing exclusive game content that gamers seek,the computational power and reliability of the devices usedto access our

271、content and services,and the ability to create new experiences through first-party content creators.Search and News AdvertisingOur Search and news advertising business is designed to deliver relevant search,native,and display advertising to aglobal audience.We have several partnerships with other co

272、mpanies,including Yahoo,through which we provide andmonetize search queries.Growth depends on our ability to attract new users,understand intent,and match intent withrelevant content and advertiser offerings.On June 6,2022,we acquired Xandr,Inc.,a technology platform with tools to accelerate the del

273、ivery of our digitaladvertising solutions.CompetitionWindows faces competition from various software products and from alternative platforms and devices,mainly from Appleand Google.We believe Windows competes effectively by giving customers choice,value,flexibility,security,an easy-to-use interface,

274、and compatibility with a broad range of hardware and software applications,including those that enableproductivity.Devices face competition from various computer,tablet,and hardware manufacturers who offer a unique combination ofhigh-quality industrial design and innovative technologies across vario

275、us price points.These manufacturers,many ofwhich are also current or potential partners and customers,include Apple and our Windows OEMs.25Xbox and our cloud gaming services face competition from various online gaming ecosystems and game streamingservices,including those operated by Amazon,Apple,Met

276、a,Google,and Tencent.We also compete with other providersof entertainment services such as video streaming platforms.Our gaming platform competes with console platforms fromNintendo and Sony,both of which have a large,established base of customers.We believe our gaming platform iseffectively positio

277、ned against,and uniquely differentiated from,competitive products and services based on significantinnovation in hardware architecture,user interface,developer tools,online gaming and entertainment services,andcontinued strong exclusive content from our own first-party game franchises as well as oth

278、er digital content offerings.Our Search and news advertising business competes with Google and a wide array of websites,social platforms like Meta,and portals that provide content and online offerings to end users.OPERATIONSWe have operations centers that support operations in their regions,includin

279、g customer contract and order processing,credit and collections,information processing,and vendor management and logistics.The regional center in Irelandsupports the European,Middle Eastern,and African region;the center in Singapore supports the Japan,India,GreaterChina,and Asia-Pacific region;and t

280、he centers in Fargo,North Dakota,Fort Lauderdale,Florida,Puerto Rico,Redmond,Washington,and Reno,Nevada support Latin America and North America.In addition to the operations centers,we alsooperate datacenters throughout the Americas,Europe,Australia,and Asia,as well as in the Middle East and Africa.

281、To serve the needs of customers around the world and to improve the quality and usability of products in internationalmarkets,we localize many of our products to reflect local languages and conventions.Localizing a product may requiremodifying the user interface,altering dialog boxes,and translating

282、 text.Our devices are primarily manufactured by third-party contract manufacturers.For the majority of our products,we havethe ability to use other manufacturers if a current vendor becomes unavailable or unable to meet our requirements.However,some of our products contain certain components for whi

283、ch there are very few qualified suppliers.For thesecomponents,we have limited near-term flexibility to use other manufacturers if a current vendor becomes unavailable or isunable to meet our requirements.Extended disruptions at these suppliers and/or manufacturers could lead to a similardisruption i

284、n our ability to manufacture devices on time to meet consumer demand.RESEARCH AND DEVELOPMENTProduct and Service Development,and Intellectual PropertyWe develop most of our products and services internally through the following engineering groups.Cloud and AI,focuses on making IT professionals,devel

285、opers,and their systems more productive andefficient through development of cloud infrastructure,server,database,CRM,ERP,software developmenttools and services(including GitHub),AI cognitive services,and other business process applications andservices for enterprises.Experiences and Devices,focuses

286、on instilling a unifying product ethos across our end-user experiences anddevices,including Office,Windows,Teams,consumer web experiences(including search and newsadvertising),and the Surface line of devices.Security,Compliance,Identity,and Management,focuses on cloud platform and application securi

287、ty,identityand network access,enterprise mobility,information protection,and managed services.Technology and Research,focuses on our AI innovations and other forward-looking research anddevelopment efforts spanning infrastructure,services,and applications.LinkedIn,focuses on our services that transf

288、orm the way customers hire,market,sell,and learn.26Gaming,focuses on developing hardware,content,and services across a large range of platforms to helpgrow our user base through game experiences and social interaction.Internal development allows us to maintain competitive advantages that come from p

289、roduct differentiation and closertechnical control over our products and services.It also gives us the freedom to decide which modifications andenhancements are most important and when they should be implemented.We strive to obtain information as early aspossible about changing usage patterns and ha

290、rdware advances that may affect software and hardware design.Beforereleasing new software platforms,and as we make significant modifications to existing platforms,we provide applicationvendors with a range of resources and guidelines for development,training,and testing.Generally,we also create prod

291、uctdocumentation internally.We protect our intellectual property investments in a variety of ways.We work actively in the U.S.and internationally toensure the enforcement of copyright,trademark,trade secret,and other protections that apply to our software andhardware products,services,business plans

292、,and branding.We are a leader among technology companies in pursuingpatents and currently have a portfolio of over 69,000 U.S.and international patents issued and over 19,000 pendingworldwide.While we employ much of our internally-developed intellectual property exclusively in our products andservic

293、es,we also engage in outbound licensing of specific patented technologies that are incorporated into licenseesproducts.From time to time,we enter into broader cross-license agreements with other technology companies coveringentire groups of patents.We may also purchase or license technology that we

294、incorporate into our products and services.At times,we make select intellectual property broadly available at no or low cost to achieve a strategic objective,such aspromoting industry standards,advancing interoperability,supporting societal and/or environmental efforts,or attractingand enabling our

295、external development community.Our increasing engagement with open source software will also causeus to license our intellectual property rights broadly in certain situations.While it may be necessary in the future to seek or renew licenses relating to various aspects of our products,services,and bu

296、siness methods,we believe,based upon past experience and industry practice,such licenses generally can beobtained on commercially reasonable terms.We believe our continuing research and product development are notmaterially dependent on any single license or other agreement with a third party relati

297、ng to the development of ourproducts.Investing in the FutureOur success is based on our ability to create new and compelling products,services,and experiences for our users,toinitiate and embrace disruptive technology trends,to enter new geographic and product markets,and to drive broadadoption of o

298、ur products and services.We invest in a range of emerging technology trends and breakthroughs that webelieve offer significant opportunities to deliver value to our customers and growth for the Company.Based on ourassessment of key technology trends,we maintain our long-term commitment to research a

299、nd development across a widespectrum of technologies,tools,and platforms spanning digital work and life experiences,cloud computing,AI,devices,and operating systems.While our main product research and development facilities are located in Redmond,Washington,we also operateresearch and development fa

300、cilities in other parts of the U.S.and around the world.This global approach helps us remaincompetitive in local markets and enables us to continue to attract top talent from across the world.We plan to continue to make significant investments in a broad range of product research and development act

301、ivities,andas appropriate we will coordinate our research and development across operating segments and leverage the resultsacross the Company.In addition to our main research and development operations,we also operate Microsoft Research.Microsoft Research isone of the worlds largest corporate resea

302、rch organizations and works in close collaboration with top universities aroundthe world to advance the state-of-the-art in computer science and a broad range of other disciplines,providing us a uniqueperspective on future trends and contributing to our innovation.27DISTRIBUTION,SALES,AND MARKETINGW

303、e market and distribute our products and services through the following channels:OEMs,direct,and distributors andresellers.Our sales force performs a variety of functions,including working directly with commercial enterprises andpublic-sector organizations worldwide to identify and meet their techno

304、logy and digital transformation requirements;managing OEM relationships;and supporting system integrators,independent software vendors,and other partners whoengage directly with our customers to perform sales,consulting,and fulfillment functions for our products and services.OEMsWe distribute our pr

305、oducts and services through OEMs that pre-install our software on new devices and servers they sell.The largest component of the OEM business is the Windows operating system pre-installed on devices.OEMs also selldevices pre-installed with other Microsoft products and services,including applications

306、 such as Office and the capability tosubscribe to Office 365.There are two broad categories of OEMs.The largest category of OEMs are direct OEMs as our relationship with them ismanaged through a direct agreement between Microsoft and the OEM.We have distribution agreements covering one ormore of our

307、 products with virtually all the multinational OEMs,including Dell,Hewlett-Packard,Lenovo,and with manyregional and local OEMs.The second broad category of OEMs are system builders consisting of lower-volume PCmanufacturers,which source Microsoft software for pre-installation and local redistributio

308、n primarily through the Microsoftdistributor channel rather than through a direct agreement or relationship with Microsoft.DirectMany organizations that license our products and services transact directly with us through Enterprise Agreements andEnterprise Services contracts,with sales support from

309、system integrators,independent software vendors,web agencies,and partners that advise organizations on licensing our products and services(“Enterprise Agreement Software Advisors”or“ESA”).Microsoft offers direct sales programs targeted to reach small,medium,and corporate customers,in addition tothos

310、e offered through the reseller channel.A large network of partner advisors support many of these sales.We also sell commercial and consumer products and services directly to customers,such as cloud services,search,andgaming,through our digital marketplaces and online stores.In fiscal year 2021,we cl

311、osed our Microsoft Store physicallocations and opened our Microsoft Experience Centers.Microsoft Experience Centers are designed to facilitate deeperengagement with our partners and customers across industries.Distributors and ResellersOrganizations also license our products and services indirectly,

312、primarily through licensing solution partners(“LSP”),distributors,value-added resellers(“VAR”),and retailers.Although each type of reselling partner may reach organizationsof all sizes,LSPs are primarily engaged with large organizations,distributors resell primarily to VARs,and VARs typicallyreach s

313、mall and medium organizations.ESAs are also typically authorized as LSPs and operate as resellers for our othervolume licensing programs.Microsoft Cloud Solution Provider is our main partner program for reselling cloud services.We distribute our retail packaged products primarily through independent

314、 non-exclusive distributors,authorized replicators,resellers,and retail outlets.Individual consumers obtain these products primarily through retail outlets.We distribute ourdevices through third-party retailers.We have a network of field sales representatives and field support personnel thatsolicit

315、orders from distributors and resellers and provide product training and sales support.Our Dynamics business solutions are also licensed to enterprises through a global network of channel partners providingvertical solutions and specialized services.28LICENSING OPTIONSWe offer options for organizatio

316、ns that want to purchase our cloud services,on-premises software,and SA.We licensesoftware to organizations under volume licensing agreements to allow the customer to acquire multiple licenses ofproducts and services instead of having to acquire separate licenses through retail channels.We use diffe

317、rent programsdesigned to provide flexibility for organizations of various sizes.While these programs may differ in various parts of theworld,generally they include those discussed below.SA conveys rights to new software and upgrades for perpetual licenses released over the contract period.It also pr

318、ovidessupport,tools,training,and other licensing benefits to help customers deploy and use software efficiently.SA is includedwith certain volume licensing agreements and is an optional purchase with others.Volume Licensing ProgramsEnterprise AgreementEnterprise Agreements offer large organizations

319、a manageable volume licensing program that gives them the flexibility tobuy cloud services and software licenses under one agreement.Enterprise Agreements are designed for medium or largeorganizations that want to license cloud services and on-premises software organization-wide over a three-year pe

320、riod.Organizations can elect to purchase perpetual licenses or subscribe to licenses.SA is included.Microsoft Customer AgreementA Microsoft Customer Agreement is a simplified purchase agreement presented,accepted,and stored through a digitalexperience.A Microsoft Customer Agreement is a non-expiring

321、 agreement that is designed to support all customers overtime,whether purchasing through a partner or directly from Microsoft.Microsoft Online Subscription AgreementA Microsoft Online Subscription Agreement is designed for small and medium organizations that want to subscribe to,activate,provision,a

322、nd maintain cloud services seamlessly and directly via the web.The agreement allows customers toacquire monthly or annual subscriptions for cloud-based services.Microsoft Products and Services AgreementMicrosoft Products and Services Agreements are designed for medium and large organizations that wa

323、nt to license cloudservices and on-premises software as needed,with no organization-wide commitment,under a single,non-expiringagreement.Organizations purchase perpetual licenses or subscribe to licenses.SA is optional for customers thatpurchase perpetual licenses.Open ValueOpen Value agreements are

324、 a simple,cost-effective way to acquire the latest Microsoft technology.These agreementsare designed for small and medium organizations that want to license cloud services and on-premises software over athree-year period.Under Open Value agreements,organizations can elect to purchase perpetual licen

325、ses or subscribe tolicenses and SA is included.Select PlusA Select Plus agreement is designed for government and academic organizations to acquire on-premises licenses at anyaffiliate or department level,while realizing advantages as one organization.Organizations purchase perpetual licensesand SA i

326、s optional.29Partner ProgramsThe Microsoft Cloud Solution Provider program offers customers an easy way to license the cloud services they need incombination with the value-added services offered by their systems integrator,managed services provider,or cloudreseller partner.Partners in this program

327、can easily package their own products and services to directly provision,manage,and support their customer subscriptions.The Microsoft Services Provider License Agreement allows hosting service providers and independent software vendorswho want to license eligible Microsoft software products to prov

328、ide software services and hosted applications to their endcustomers.Partners license software over a three-year period and are billed monthly based on consumption.The Independent Software Vendor Royalty program enables partners to integrate Microsoft products into otherapplications and then license

329、the unified business solution to their end users.CUSTOMERSOur customers include individual consumers,small and medium organizations,large global enterprises,public-sectorinstitutions,Internet service providers,application developers,and OEMs.Our practice is to ship our products promptlyupon receipt

330、of purchase orders from customers;consequently,backlog is not significant.AVAILABLE INFORMATIONOur Internet address is .At our Investor Relations website, makeavailable free of charge a variety of information for investors.Our goal is to maintain the Investor Relations website as aportal through whi

331、ch investors can easily find or navigate to pertinent information about us,including:Our annual report on Form 10-K,quarterly reports on Form 10-Q,current reports on Form 8-K,and anyamendments to those reports,as soon as reasonably practicable after we electronically file that material withor furnis

332、h it to the Securities and Exchange Commission(“SEC”)at www.sec.gov.Information on our business strategies,financial results,and metrics for investors.Announcements of investor conferences,speeches,and events at which our executives talk about ourproduct,service,and competitive strategies.Archives o

333、f these events are also available.Press releases on quarterly earnings,product and service announcements,legal developments,andinternational news.Corporate governance information including our articles of incorporation,bylaws,governance guidelines,committee charters,codes of conduct and ethics,global corporate social responsibility initiatives,and othergovernance-related policies.Other news and an