Microsoft's (MSFT) Bing Search May Be Profitable Undertaking Soon

Microsoft's (Nasdaq: MSFT) Bing search engine has arguably made big strides since its debut a few years back. From partnering with Yahoo!, to Windows Phone user retention, to hitting double-digit market share in the U.S., the search engine is somewhat of a Cinderella story. Even if it did come from Microsoft.

ZDNet said today that the segment is also no longer the cash burner it once was. Microsoft Applications and Services Group CEO Dave O'Hara commented during a UBS investor call on Wednesday that the reason for early losses in the segment was because Microsoft had to make big infrastructure investments to accelerate from zero-to-"moderately on par with Google" [our words, not his].

With infrastructure in place, Microsoft's investments in the segment will be incremental. He also thinks Bing is on course or ahead of course to meet its breakeven point. In the past, Microsoft execs said Bing would breakeven when it was around 20 to 25 percent market share. While O'Hara didn't comment on when Bing would be there, he did say breakeven would be closer to the low-end of that range. (Latest checks have Bing with 10 to 13 percent U.S. share, depending on the research firm reporting the numbers.)

Microsoft won't report Online Services (Bing, MSN, online advertising) by itself anymore, but in the lates quarter the segment had a loss of $321 million on revenue of $872 million.

Shares of Microsoft are up 1.7 percent Friday.

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