Microsoft Shares Rise on Cloud Revenue Gains

By
Bill McColl
Bill McColl
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Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time.

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Published January 24, 2023
People walking in front of a Microsoft store

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Key Takeaways

  • Microsoft (MSFT) reported earnings results after the markets closed on Jan. 24, 2023, showing a greater-than-expected increase in cloud revenue.
  • The software giant also beat analysts forecasts on earnings per share (EPS) but narrowly missed revenue expectations.
  • Shares of Microsoft rose 4% in after-hours trading following the earnings release.

Microsoft (MSFT) shares are gaining in extended trading after the software giant beat quarterly profit estimates and revenue from its cloud unit rose more than anticipated.

Microsoft reported fiscal 2023 second quarter earnings per share (EPS) of $2.32, exceeding analysts' forecasts. Sales were up 2% to $52.75 billion, short of expectations and the slowest rate of growth in any quarter since 2016.

Revenue at its Intelligent Cloud unit gained 18% to $21.5 billion, driven higher by a 31% increase for Azure and other cloud services. Sales rose 10% at LinkedIn. Revenue sank 39% for both Windows OEM and devices.

10,000 Jobs Cut

The report came just days after CEO Satya Nadella announced 10,000 job cuts, telling employees the company needed to "align our cost structure with our revenue and where we see customer demand." As with many other tech firms recently, Microsoft has faced a slowdown in customer spending following the boom in demand during the COVID-19 pandemic.

Shares of Microsoft are up 4% in after-hours trading. They ended the regular session down 18% over the past year.

Chart showing the share price performance of Microsoft Corporation (MSFT) on Jan. 24

YCharts
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

  1. Microsoft. "Earnings Release FY23 Q2."

  2. Microsoft. "Focusing on Our Short- and Long-Term Opportunity."

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