Microsoft Slips As Revenue Falls Short Of Estimates


Microsoft Corp (NASDAQ: MSFT)

Share of Microsoft were down nearly 4% in the extended trading session on Wednesday after fiscal second quarter revenue of the tech giant missed Wall Street estimates. Microsoft came into the earnings season from a position of strength.

Currently, it is the most valuable company in the world ahead of Amazon. Its market value continues to rise thanks, in part, to Microsoft’s decision to work across multiple operating systems and devices rather than with its products alone.

MSFT Earnings & Outlook

The tech giant reported fiscal second quarter net income of $8.42 billion, or $1.08 per share, up from a loss of $6.3 billion, or $0.82 per share, in the same period last year. Excluding non-recurring items, earnings came to $1.10 per share. Analysts had modelled adjusted earnings of $1.09 per share, according to figures compiled by Refinitiv.

Microsoft generated total revenues of $32.47 billion, compared with $28.92 billion in the same period last year. Analysts expected the company to post revenues of $32.51 billion for the quarter, based on Refinitiv data.

The firm’s cloud business, saw revenue rise to $9.4 billion, up 20% from last year. Revenue from the Productivity and Business processes unit was $10.1 billion, up 13%. Meanwhile, More Personal Computing segment raked revenues of $13 billion, an improvement of 7% year-over-year.

Microsoft Executive Comments

“Our strong commercial cloud results reflect our deep and growing partnerships with leading companies in every industry including retail, financial services, and healthcare,” said Satya Nadella, CEO of Microsoft. “We are delivering differentiated value across the cloud and edge as we work to earn customer trust every day.”

“Our solid execution delivered another strong quarter, with commercial cloud revenue growing 48% year-over-year to $9.0 billion,” said Amy Hood, executive vice president and chief financial officer of Microsoft. “We continue to make strategic investments to capture expanding market opportunities to drive growth across our businesses.”

Microsoft Corp. Profile

Microsoft Corp. engages in the development and support of software, services, devices, and solutions. Its products include operating systems; cross-device productivity applications; server applications; and business solution applications. It also offers personal computers, tablets, gaming and entertainment consoles, other intelligent devices, and related accessories.

It operates through the following business segments: Productivity and Business Processes; Intelligent Cloud; and More Personal Computing. The Productivity and Business Processes segment is comprised of products and services in the portfolio of productivity, communication, and information services of the company spanning a variety of devices and platform.

The Intelligent Cloud segment refers to the public, private, and hybrid serve products and cloud services of the company which can power modern business. The More Personal Computing segment encompasses the products and services such as windows operating system, devices, gaming platform, and search engines. The company was founded by William Henry Gates III in 1975 and is headquartered in Redmond, WA. – CNN Money