Microsoft reported worse than expected and warned of a further drop in revenue


Microsoft results for the second quarter of fiscal year 2023 (ended December 31, 2022) turned out to be weaker than analysts' forecasts. At the same time, the company itself warned that in the next quarter its financial performance will continue to decline due to a drop in demand for its products from both ordinary consumers and businesses. Thus, the corporation's revenue for the quarter amounted to $52.75 billion, which is only 2% higher than the figure for the same period in 2021. This is the company's weakest quarterly revenue growth since 2016. In addition, the company fell short of forecasts by analysts polled by Refinitiv, who had expected revenue to reach $52.94 billion.

Microsoft's net profit for the quarter is $16.4 billion, which is 12% worse than the figure for the second quarter of fiscal 2022. The drop in profits was largely facilitated by the write-off of $ 1.2 billion due to the massive reduction in employees, declared last week. This amount includes $ 800 million, which the corporation will pay as a severance pay to the reduced ones.

Microsoft shares after the publication of financial statements initially rose by 4%, as quarterly figures for Microsoft's cloud business turned out to be slightly better than forecasts, including from the company itself. However, as soon as CFO Aimee Hood said during the presentation of the results that the performance of the cloud division slowed down in December, and the company's revenue growth will continue to slow in the next quarter, Microsoft's stock prices crept down. As a result, they are quoted 1% below Tuesday's close in OTC trading.

Kirill Sarkhanyants



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