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Bing finally shows a profit

Microsoft's search business has turned the corner, generating $1 billion in revenue during the company's fiscal first quarter.

Bing launched in 2009 as a replacement to previous Microsoft search engines.

It's been a long, long time coming, but Microsoft's Bing is no longer a bottomless money pit.

Microsoft said Thursday in its fiscal first quarter earnings call that Bing had achieved profitability. Search contributed more than $1 billion to Microsoft's first quarter that ended September 30, said Chief Financial Officer Amy Hood.

More interestingly, nearly 20 percent of Microsoft's search revenue in September was driven by Windows 10 devices, executives said. By building Cortana, Microsoft's personal digital assistant powered by Bing, directly into Windows 10, Microsoft is automatically increasing the number of Bing searches.

Microsoft has been working to streamline its search and ad business for months. Earlier this year, the company handed off its display advertising business to AOL. The company also opted to get out of the map-data-collection business and sold off those assets to Uber.

Bing's growth as a Web search engine has been helped noticeably by Microsoft's search pact with Yahoo. Earlier this year, Yahoo and Microsoft negotiated a revised deal. This week, Yahoo announced it would be working more with Google, with Google providing some search results and ads for Yahoo search queries.

Microsoft isn't simply relying on Yahoo to expand Bing and search, however. Microsoft has been building Bing into more of its products over time.

Microsoft officials said in its fiscal first quarter report that its search revenue, excluding traffic-acquisition costs, grew 29 percent year over year, driven by higher revenue per search and search volume.

For the past few months, Microsoft execs had been saying to expect Bing to break even some time during the company's fiscal 2016. Microsoft officials told analysts back in 2013 that Microsoft could see the light at the end of the Bing data-center-building tunnel.

This story originally posted as "Microsoft's Bing search business finally is profitable" on ZDNet.