Ballmer, Microsoft CEO from 2000 to 2014, said that while Amazon is a direct competitor to Azure, it's Google that could challenge Microsoft's Office 365 product.
"With Amazon Web Services, Azure is the challenger, it has only one way to go, which is up. With Office 365 there is more upside than downside, and that's a Google risk," Ballmer said.
Microsoft's cloud division has been growing fairly strongly, and it's an area current CEO Satya Nadella has flagged as the company's future. Microsoft's cloud business brought in $6.86 billion in revenue during the fiscal second quarter. Azure revenue increased 93 percent.
The U.S. technology giant has also been focusing on hardware, pioneering new product categories like the 2-in-1 tablet called Surface and recently announced its next games console called Xbox Scorpio. Ballmer said he was "most pleased" with the progress in the Surface line of products, and the hardware division has "progressed nicely."