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  • Writer's picturejustinlawrence137

Microsoft Earnings (Hit & Miss)

Here is a quick update on Microsofts earnings after market close this afternoon.

Microsoft's earnings can have a significant impact on the stock market. If the company releases strong earnings results, it can cause the stock price to rise, which in turn can positively impact the overall market. Conversely, if the company releases weak earnings results, the stock price may decline and negatively impact the overall market. However, it's important to note that the market's reaction to a company's earnings is not always predictable and can be affected by a variety of factors such as overall market conditions, investor sentiment, and the company's forward guidance.

Microsoft announced its Q2 earnings after the bell on Tuesday, barely missing analysts' expectations on revenue and beating on earnings per share.

Here are the most important numbers from the report compared to what analysts were expecting from the quarter, as compiled by Bloomberg.

  • Revenue: $52.7 billion vs. $52.9 billion expected

  • Adjusted EPS: $2.32 vs. $2.30 expected

  • Productivity and Business processes: $17 billion vs. $16.8 billion expected

  • Intelligent Cloud: $21.5 billion vs. $21.4 billion expected

  • More Personal Computing: $14.2 billion vs. $14.7 billion expected

Despite the beat on earnings per share, Microsoft's cloud business continued to slow in the quarter. The company reported its Intelligent Cloud segment grew 18% in the quarter, while its Azure services grew 31%. That's down from Q2 last year, during which Intelligent Cloud and Azure saw growth of 26% and 46%, respectively.

“The next major wave of computing is being born, as the Microsoft Cloud turns the world’s most advanced AI models into a new computing platform,” Microsoft CEO Satya Nadella said in a statement.

“We are committed to helping our customers use our platforms and tools to do more with less today and innovate for the future in the new era of AI.” Microsoft's announcement follows news that the company is engaging in a multi-year, multi-billion dollar investment in OpenAI in an attempt to better tackle competitors including from Amazon to Google.

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