When investors think of Microsoft (MSFT 0.68%) these days, several high-profile topics likely spring immediately to mind.

The tech giant helped kick off the recent artificial intelligence (AI) gold rush. The company revealed it had made a $13 billion investment in OpenAI, the creator of the next-generation chatbot ChatGPT, and is integrating generative AI into its Bing search engine. Furthermore, Microsoft's planned acquisition of Activision Blizzard has been making fresh headlines, as a recent court ruling may pave the way for the deal to close later this month.

However, another massive opportunity that isn't getting nearly as much press could actually be Microsoft's next big opportunity for growth.

A person sitting at a desk with multiple computer monitors writing code.

Image source: Getty Images.

Call security

Investors might not think of Microsoft as a cybersecurity company, but securing enterprise assets is one of its fastest-growing business lines. In January, it reported that its annual cybersecurity revenues had surpassed $20 billion and were growing by 33% annually. Even more telling was the number of existing customers that were increasing their security relationships with Microsoft, as the number of enterprises with four or more workloads grew by 40% year over year. 

CEO Satya Nadella noted that Microsoft is the "only company with integrated, end-to-end tools spanning identity, security, compliance, device management, and privacy." He went on to say that its system is trained on over 65 trillion signals each day, and the company is "taking share across all the major categories we serve." 

A growing catalog of product offerings

Microsoft continues to expand its cybersecurity business. Early this year, the company announced plans to enter the secure service edge (SSE) market, joining its endpoint security and identity protection offerings. Last quarter, Microsoft announced the launch of Security Copilot, a service powered by large language models and generative AI.

Just this week, the company debuted its two latest products: Microsoft Entra Internet Access, which the company says is "an identity-centric Secure Web Gateway that protects access to internet, software-as-a-service (SaaS), and Microsoft 365 apps and resources," and Microsoft Entra Private Access, "an identity-centric Zero Trust Network Access that secures access to private apps and resources."

Microsoft says users can access their applications "across hybrid and multicloud environments, private networks, and data centers ... from any device and any network." Both products are currently in preview and will be fully available later this year. 

This large and growing catalog of cybersecurity products gives Microsoft numerous ways to expand its relationships with existing customers and attract new ones.

Microsoft's position as one of the leading providers of cloud infrastructure systems gives it a distinct advantage here. It can bundle its cybersecurity offerings with its Azure cloud computing business, Office 365, and other SaaS offerings. By providing these services as add-ons for its existing customers in other areas, Microsoft offers them a way to simplify their processes and consolidate to fewer vendors.

Expanding its total addressable market

Microsoft is already addressing several sizable market opportunities. The global SaaS market is expected to grow to roughly $716 billion by 2028, according to Fortune Business Insights. Overall, the global cloud computing market -- including cloud infrastructure, platform-as-a-service (PaaS), and SaaS -- is expected to grow from $546 billion to $1.2 trillion by 2027, according to Markets and Markets. 

Yet the opportunity for internet security services is far greater. The global cybersecurity market could grow to a range of $1.5 trillion to $2 trillion, according to data compiled by management consulting firm McKinsey & Company -- 10 times the current market size. 

The opportunity is there, but it will be up to Microsoft to capitalize on it. There's also an argument to be made that pure-play cybersecurity vendors will always be at the cutting edge of the technology since security is their sole focus. 

Still, given its existing cloud and SaaS businesses, cybersecurity is a natural next step, and it could be a lucrative one for Microsoft -- and its investors.