Investors not so happy with Microsoft’s earnings results, stock down 3 percent

Microsoft yesterday reported its earnings results for the quarter ended December 31, 2018. The reported numbers didn’t break any new record and just met analysts estimates. Revenue was $32.5 billion, a modest 12% increase YoY and the operating income was $10.3 billion, an 18% increase. Microsoft CEO Satya Nadella mentioned that strong commercial cloud performance lead to these results. But investors are not so happy with Microsoft’s results which resulted in 3% decline of stock value after the market closed.

The following could be the concerns for investors:

  • Azure growth slowed down. Microsoft reported 76% revenue growth compared to 98% growth last year.
  • Due to stronger US dollar, Microsoft anticipates about 2 points of negative FX impact on revenue growth in Productivity and Business Processes and Intelligent Cloud, and 1 point in More Personal Computing.
  • Office consumer revenue growth to continue to be in the low single digits due to slow down in PC market.
  • Windows OEM revenue declined 5% due to PC market slow down and the decline will continue in this quarter.
  • Microsoft expects this quarter revenue between $29.4 billion and $30.1 billion. Analysts were expecting $29.9 billion.

If Microsoft’s stock price goes down today, Amazon may overtake its market cap once again.

Some links in the article may not be viewable as you are using an AdBlocker. Please add us to your whitelist to enable the website to function properly.

Related
Comments