Microsoft Teams hits 115M users — here’s why Satya Nadella is excited about the platform

(Microsoft Image)

Microsoft continues to rapidly expand its Teams collaboration software user base. Teams now has 115 million daily active users, up more than 50% from April (75 million users), and more than 160% from March (44 million users).

Microsoft CEO Satya Nadella revealed the latest statistic during the company’s fiscal first quarter earnings call. The growth of Teams illustrates how more companies are using collaboration apps with the shift to remote work amid the pandemic. Others including Zoom, Slack, Google, and more offer competing products in the booming market for collaboration technology.

The Teams growth also explains one of the reasons why Microsoft’s revenue and profits climbed in the September quarter. The company’s Productivity and Business Processes division, which includes Teams, was up 11% over last year to $12.3 billion in the quarter.

“We are seeing increased usage intensity as people communicate, collaborate and co-author content across work, life, and learning,” Nadella said on the call.

Teams has an advantage over competitors because it is offered as a component of the Microsoft 365 subscription plans that include the company’s widely used Office productivity software.

Nadella touted how Microsoft is able to integrate Teams with other 365 apps such as PowerPoint and Dynamics. Microsoft is not only seeing increased Teams usage but also “significant growth of usage across all these modalities inside of Teams,” he said.

“Teams is very exciting to us, because unlike anything else that we’ve done at the application layer, it’s literally like a shell,” Nadella said. “It has a platform effect. It is meetings; it’s chat; it’s collaboration; as well as business process applications, integrated into Teams. That scaffolding richness literally makes it a very robust platform.”

He added: “Meetings are important, but they are transactional. Work happens before meetings, during meetings, and after meetings. That ability to have the workflow completely stitched together is where Microsoft 365 really stands out. That reinforcing effect of Teams by itself, and then Microsoft 365 in conjunction with Teams, is where you’ll see a significant amount of usage growth, more so than individual tools of the past, even.”

The integration between Teams and other Office apps is the focus of an antitrust complaint filed by Slack against Microsoft this summer. The San Francisco-based company accuses Microsoft of illegally bundling its Teams software with its Office apps, giving it an unfair advantage.

Slack reported more than 133,000 paid customers as of the end of the quarter ended Sept. 30, up 30% year-over-year. The company had more than 12 million daily active users as of October 2019, the last time it released that figure.

Zoom said its revenue grew 355% year-over-year in its most recent quarter. The company has 370,200 customers with more than 10 employees, up 458% from last year. Zoom does not release a daily active user statistic; in April it said it had 300 million “daily meeting participants,” a different metric that can be counted multiple times for one user during a single day.

Microsoft has released more than 100 new capabilities for Teams in the past six months. Last month it announced new Teams features including breakout rooms, a “virtual commute” tool, and new “Together Mode” backdrops. In May it gave software developers the option to build apps for Teams in its Visual Studio development environment.

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