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Microsoft Stock Plummets 10% on Missed Earnings
30 Jan
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 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%.
