Microsoft posts better-than-expected earnings, optimistic forecasts

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Microsoft’s shares initially dipped before experiencing an uptick (as much as 1%) in extended trading on Tuesday, after the software behemoth issued its Q4 earnings and quarterly revenue guidance that exceeded analysts’ predictions.

The company has $2.17 earnings per share (adjusted), compared to the $1.92 per share that Refinitiv analysts expected. As for revenue, the company reported revenue of $46.15 billion, even though analysts had predicted $44.24 billion.

Revenue rose 21% year on year in the quarter ended June 10, according to the statement the company made, up 4.7% from the previous quarter which recorded 19%.

Guidance

Microsoft offered guidance indicating that it expects $14.5 to $14.75 billion in fiscal first-quarter revenue from its Productivity and Business Processes unit, higher than the $14.07 billion consensuses.

The Intelligent Cloud segment is projected by the company to be on track to bring in $16.4 billion to $16.65 billion in revenue, higher than the $15.71 billion StreetAccount estimates.

As for the Personal Computing segment, Microsoft’s estimates stand at $12.4 billion to $12.8 billion in revenue. The StreetAccount estimate is at $12.67 billion, right on the mid-range position of the Microsoft estimate.

Other major segments earnings

In the fiscal Q4, Microsoft’s Intelligent Cloud segment, which includes the Azure cloud, Windows Server, GitHub, and SQL Server, produced a combined $17.38 billion in revenue, up 30% year over year.

Analysts polled by StreetAccount had placed the average estimates at $16.33 billion in revenue.

Revenue from Azure, which faces competition from AWS, grew 51% in the quarter (45% without adjusting). Analysts had expected about 45.3% growth from the cloud, while the StreetAccount consensus was 42%.

In the previous quarter, Azure’s revenue went up by 50%. Even with the good news, Microsoft did not release Azure’s revenue in dollars. Check out the complete report here.