Microsoft CEO Satya Nadella is seen at an event with senior officials and CEOs in the East Room of the White House on June 22, 2023 in Washington.
Chris Klaponis | CNP | Bloomberg | Getty Images
Microsoft It will report its fiscal fourth-quarter results after the market closes on Tuesday.
The key numbers to follow are:
- Income: $2.55 per share, adjusted for analysts’ expectations, according to Refinitiv.
- Income: Analysts expected $55.47 billion, according to Refinitiv.
Based on analyst estimates, Microsoft will close fiscal 2023 with revenue growth below 10% for the first time since 2017. Growth is expected to be closer to 7% for the latest quarter. Businesses have been delaying cloud and software deployments since last year due to economic uncertainty and the prospect of higher interest rates.
Microsoft CEO Satya Nadella told employees in May that the company would not raise salaries this year.
Analysts polled by CNBC and StreetAccount predict that Microsoft will report a roughly 25% year-over-year increase in revenue from the Azure public cloud, which Amazon Web Services and Google Cloud platform. Microsoft does not report Azure revenue in dollars. The expected growth rate is similar to what analysts expect from Google’s cloud division. Parent company Alphabet also reports results after the bell on Tuesday.
During the quarter, Microsoft built on its broader alliance with OpenAI to capitalize on renewed interest in artificial intelligence, following the launch of the startup’s ChatGPT chatbot in November. Microsoft introduced a chatbot powered in part by OpenAI language models to help workers understand their employers’ data, and it said developers will be able to create plugins that people can access through ChatGPT, the Bing search engine’s chatbot and other tools.
Investors are eager for resolution in Microsoft’s deal to buy Activision Blizzard for about $69 billion, which was agreed in January 2022. Activision shares have risen to $92.50, close to the $95 that Microsoft has agreed to pay, reflecting hopes that the deal is on track to close.
Microsoft shares are up 44% year to date, while the S&P 500 is up 19%.
In June, Microsoft said it expected to take a $425 million charge in the quarter to pay a fine from Ireland’s Data Protection Commission after the authority looked into whether the company’s LinkedIn unit violated the EU’s General Data Protection Regulation.
Executives will discuss quarterly results with analysts and issue guidance on a conference call beginning at 5:30 pm ET.
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