Microsoft Earnings Beat Across the Board, Stock Up on Outlook

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Microsoft shares rose as high as 6% during extended trading Tuesday after the software manufacturer released fiscal third-quarter earnings, which exceeded analysts’ expectations. The company also gave an optimistic outlook for this quarter.

Here’s what the company did:

  • Earnings 2.22 per share adjusted vs. 2.19 as expected analysts according to Refinitiv.
  • Revenue $49.36 Billion vs. $49.05 Billion as analysts expected, according to Refinitiv.

According to a statement, Microsoft’s quarter ended March 31 with an 18% increase in revenue year-over-year. This compares to 20% in last quarter. Microsoft posted the lowest revenue beat since 2018, surpassing the consensus by less than 1%.

The total sales and marketing expenses reached $5.6 billion, 10% more than the quarter before, representing the fastest growth in three years.

Amy Hood, Microsoft’s chief financial officer, called for fiscal fourth-quarter revenue of $52.4 billion – $53.2 billion during a conference call with analysts.

StreetAccount analysts were more impressed with Hood’s guidance on revenue for each of three of its business segments than they were.

The middle range, $52.8 billion, for total revenue is below analysts’ consensus polled at Refinitiv.

The $19.05 billion revenue generated by the company’s Intelligent Cloud segment included Microsoft’s Azure public clouds for application hosting and SQL Server, Windows Server, and enterprise services.

This is 26% more than the consensus of StreetAccount analysts, who estimated that $18.90 billion was achieved.

The quarter saw 46% revenue growth from Azure and other cloud services, compared to 46% growth during the previous quarter.

According to CNBC’s survey of 13 analysts and StreetAccount, the expectation was 45.3%. StreetAccount polled analysts expecting 43.6% growth.