Microsoft stock flat despite better-than-expected earnings, strong Azure growth – ProWellTech
Today after the bell, Microsoft reported its earnings for the third quarter of 2020, the period of that period corresponds to the fiscal period of the first quarter of 2021. In the three months ending September 30, Microsoft recorded revenues of $ 37.2 billion and a profit per share of $ 1.82.
Analysts had predicted that the company would report $ 1.54 in earnings per share, generated by $ 35.72 billion in revenue.
In the aftermath of the tick, the company’s stock is effectively flat, earning only a fraction of a point in overtime trading. Microsoft was up nearly 2% in afternoon trading, despite somewhat erratic markets.
Leading the movement in Microsoft’s stock price was the all-important Azure update. Here’s what Microsoft said:
Revenue from server products and cloud services increased by 22% (+ 21% in constant currency) thanks to Azure revenue growth of 48% (+ 47% in constant currency)
Analyzing investor sentiment, it appears that a closer number in the 1940s was expected by most, making the Azure result a strong number.
The broader category that Azure falls into, called “Intelligent Cloud,” had $ 13 billion in revenue, up 20 percent from a year ago quarter. This was the best performance of Microsoft’s three units, which also includes Office and LinkedIn’s “Productivity and Business Processes” group which recorded $ 12.3 billion in revenue, up 11%, and the hefty Windows and Xbox “More Personal Computing” With revenues of $ 11.8 billion, up 6% from the quarter a year ago.
Other highlights of a first reading of the company’s earnings report include:
- Strong Surface revenue, up 37% from the same period a year ago
- Bing’s revenue falls, with the company saying “[s]Revenue from search advertising excluding traffic acquisition costs fell by 10% “
- Commercial cloud revenue of $ 15.2 billion, up 31% from the same period a year ago
- LinkedIn manages a 16% revenue increase in the quarter
- In-game earnings of 22% year over year
- Consumer PC demand, seen in PC sales numbers, increased non-Pro Windows OEM revenue by 31% compared to a year ago quarter, even as Pro-focused Windows OEM revenue fell 22%
Looking ahead, analysts expect Microsoft to post $ 1.60 in profit per share in the current quarter, versus $ 40.4 billion in total revenue. The company will announce its projections on its earnings call.