Why did Microsoft stock drop significantly?

Microsoft shares dropped approximately 10% due to an earnings report that fell short of investor expectations, with key metrics like Azure growth and computing segment revenue missing targets.

What was Microsoft's market capitalization reduction?

The company's market capitalization was reduced by $357 billion following the stock's sharp decline on Thursday.

What was the growth rate for Microsoft's Azure cloud services?

The growth rate for Azure and other cloud services was 39%, which was below the consensus expectation of 39.4%.

Home / Business and Economy / Microsoft Stock Plummets 10% on Missed Earnings

Microsoft Stock Plummets 10% on Missed Earnings

30 Jan

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Summary

Microsoft shares dropped 10% after a disappointing earnings report.
The company's market value decreased by $357 billion.
Azure cloud services growth was 39%, below expectations.

Microsoft Stock Plummets 10% on Missed Earnings

Microsoft shares plummeted approximately 10% on Thursday, marking the most significant daily decline since March 2020. This sharp drop followed an earnings report that disappointed investors, reducing the technology giant's market capitalization by $357 billion and closing Thursday trading at $3.22 trillion.

The underperformance was largely attributed to growth statistics for Azure and other cloud services coming in at 39%, narrowly missing the 39.4% consensus. Additionally, the More Personal Computing segment, which includes Windows, received a fiscal third-quarter revenue forecast below expectations. The implied operating margin for the upcoming quarter also fell short of projections.

Microsoft's finance chief, Amy Hood, suggested that the cloud growth figures could have been higher. She indicated that if the company had allocated more of its newly available GPUs to Azure customers rather than prioritizing internal needs, the key performance indicator would have surpassed 40%.