Microsoft surpassed Wall Street's earnings expectations for the second fiscal quarter, reporting $3.23 per share earnings on $69.63 billion in revenue. While revenue grew 12.3% year-over-year, marking the slowest pace since mid-2023, Microsoft's Azure and other cloud services revenue growth slowed to 31% from 33% in the previous quarter. Despite the slowdown, Microsoft CEO Satya Nadella highlighted the company's strong position in artificial intelligence and its ongoing investments in this area. Microsoft shares dipped 2% following the earnings report.
The software giant topped Wall Street's fiscal second-quarter estimates, posting earnings of $3.23 per share on $69.63 billion in revenue. The decline came as Microsoft finance chief Amy Hood said the company expects revenues for the current quarter to fall short of analyst estimates.
, posting earnings of $3.23 per share on $69.63 billion in revenue. That surpassed the EPS of $3.11 and $68.78 billion forecast by analysts polled by LSEG. The decline came as Microsoft finance chief Amy Hood said the company expects revenues for the current quarter to range between $67.7 billion and $68.7 billion, falling short of the $69.78 billion per LSEG. Revenue grew 12.3% year over year — the slowest growth since the middle of 2023.Microsoft also posted a slowdown in growth in its Azure and other cloud services revenues. The segment was up 31%, down from 33% in the prior quarter.despite the disappointing guide and Azure slowdown. Goldman Sachs analyst Kash Rangan called the company"well-positioned" to continue benefitting from artificial intelligence adoption and among the"most compelling investment opportunities" in the industry.Tesla reports $600 million bitcoin profit jump after digital assets rule change"Microsoft has proven they can drive a Cloud business, and now they have shown they can drive the largest AI business via a combination of high-quality Gen AI inferencing and Gen AI apps," wrote Bernstein's Mark Moerdler, adding that management needs to pivot toward the core Azure business independent of AI. Microsoft shares dipped 2% during Monday's session as part of a broader tech sector selloff. The drop came as Wall Street assessed the fallout frommodels. Estimates suggest the China startup trained its open-source model at a fraction of the costs for other competing U.S. products. Microsoft CEO Satya Nadella said during the earnings call that DeepSeek's R1 model is currently available through GitHub and the company's Azure AI Foundry. It will also eventually be accessible on Copilot+ PCs, he said.What really happened with water during LA wildfire, and how other cities can prepare‘I lost purpose': At 27, he sold his company for $100 million — now, he says it's changed his view on money
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