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Microsoft MSFT was recently reaffirmed through the U. S. Department of Defense (DoD) as the winner of its Joint Enterprise Defense Infrastructure (JEDI) cloud agreement. The resolution adopted after a reassessment of the contributions submitted. In particular, the contract is intended to be worth $10 billion and last 10 years.
The large IDIQ (indefinite delivery / indefinite quantity) contract will allow the Department of Defense to improve its generation infrastructure.
For Microsoft, the victory of the JEDI agreement has the perspective of its position in the cloud computing market and drives profit growth. In addition, the contract can lead to more victories from government and federal agencies.
Microsoft Corporation Price Consensus Chart Quote from Microsoft Corporation
Reconfirmation of the victory of the JEDI contract at Microsoft is expected to increase investor optimism in inventory in the coming days. In particular, since the beginning of the year, Microsoft inventories have returned 35. 9% to the industry rebound of 32. 2%.
There are some obstacles in the way for Microsoft.
In October 2019, Microsoft won the contract for the first time through the Pentagon. Since then, Amazon AMZN has been working to prevent Microsoft from running the contract. The tech giant received an initial court order issued through the Federal Claims Court on February 13. , 2020, which does not allow Microsoft to quickly start executing the contract.
Amazon vehemently opposed the award of the agreement to Microsoft. In a critical blog post, published on September 4, the cloud computing giant said the award of this great deal to Microsoft created a “dangerous precedent”, as alleged political biases interfered with the acquisition. Process.
This may mark an escalation in legal disputes over the JEDI contract, which has been fiercely challenged since it was filed through the DoD in 2018.
In particular, Amazon, along with Microsoft, Oracle ORCL, Alphabet’s Google and IBM Corp. IBM were among the last bidders of the JEDI agreement. However, Alphabet had withdrawn the race early due to the clash with his corporate values. In the end, Microsoft and Amazon were chosen through the Pentagon as the last two contenders, which worked well with Oracle.
Oracle has filed several lawsuits, but has faced repeated setbacks. Oracle recently faced another setback when the US Court of Appeals rejected its finding that the federal JEDI hiring procedure was unfair. In July 2019, the company’s allegations that the JEDI cloud contract violated the procurement legislation was overturned through the Federal Claims Court.
In terms of Microsoft selection, the company has made hybrid technology a very important component of its cloud strategy, which assists the DoD in its critical operations. In addition, Microsoft has already collaborated several times with the DoD to varying degrees, possibly facilitating Microsoft’s selection.
Microsoft is strengthening Azure functions by investing in technologies such as Kubernetes and GitHub Actions to automate the code verification procedure and deploy containerized programs and Internet programs, making it a vital engine for Azure cloud adoption.
In fact, Microsoft Azure is gaining ground in the cloud space and only follows Amazon Web Services (AWS). According to a report from Canalys, for the time of the 2020 quarter, Microsoft’s market location percentage in the cloud is over 20% from 18% in the last quarter of the year. AWS ‘market place percentage was unchanged at 31% for the time of the 2020 quarter on an annual basis, and in the fourth quarter of fiscal 2020, Azure’s earnings grew 47% on an annual basis .
In addition, the company will gain the benefits of an immediate migration to the cloud through companies around the world, caused by the coronavirus crisis. According to a MarketandMarkets report, the cloud computing market is expected to grow at an annual compound rate of 17. 5% between 2020. and 2025.
Microsoft’s cloud projects help you capitalize on expansion customers and gain benefits from their monetary functionality in the coming days.
Microsoft currently has a range of Zacks 3 (Keep). You can see the full list of existing Zacks moves: 1 rank here.
Last year, it generated $24 billion in global revenue. By 2020, it is expected to shoot through the clouds to succeed at $77. 6 billion. Prominent investor Mark Cuban said it would produce “the world’s first trillionaires,” but that still leaves a lot of cash to normal investors who make the right transactions in advance.
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Want to know the latest recommendations from Zacks Investment Research?Today you can download 7 moves for the next 30 days. Click to get this loose report from Microsoft Corporation (MSFT): Free International Business Machines Corporation (IBM): Free Inventory Analysis Report Amazon. com, Inc. (AMZN): Oracle Corporation Free Inventory Analysis Report (ORCL): Free Stock Analysis Report To read this article on Zacks. com, click here.