Microsoft posted its fiscal second quarter earnings late Tuesday, beating analysts’ expectations. However, it forecast current quarter revenues for its intelligent cloud division which missed analysts’ expectations (according to Refinitiv survey).
The tech behemoth’s adjusted earnings slipped -6.5% from the year-ago quarter to $2.32 per share, topping the Street consensus forecast of $2.30 per share.
Revenues climbed +1.9% from the year-ago quarter to $52.7 billion, but were slightly below analysts' expectations of $52.97 billion.
Revenues for Azure, its flagship cloud segment, surged +31% year-over-year, exceeding the Street forecasts. However, the rate of growth slowed from earlier gains in the mid to high 40-percent range.
Productivity and business division sales (which includes Office 365) were up +7% to $17 billion. Intelligent Cloud revenues grew +18% to $21.5 billion. More Personal Computing revenues, which includes Windows, were down -19% to $14.2 billion.
The group projected current quarter revenues for its intelligent cloud division in the range of $21.7 billion to $22 billion, that’s below Refinitv forecasts.
Earlier, Microsoft announced plans to layoff around 5% of its global workforce as it seeks to align costs with customer demand and boost investment in areas such as AI and other advanced technologies. According to the company, severance payments and other costs linked to the job cuts were $800 million.
MSFT may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 34 cases where MSFT's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on December 02, 2024. You may want to consider a long position or call options on MSFT as a result. In of 87 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for MSFT just turned positive on November 26, 2024. Looking at past instances where MSFT's MACD turned positive, the stock continued to rise in of 50 cases over the following month. The odds of a continued upward trend are .
MSFT moved above its 50-day moving average on November 26, 2024 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for MSFT crossed bullishly above the 50-day moving average on December 03, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 17 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where MSFT advanced for three days, in of 337 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 3 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
The 50-day moving average for MSFT moved below the 200-day moving average on November 29, 2024. This could be a long-term bearish signal for the stock as the stock shifts to an downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where MSFT declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 87, placing this stock better than average.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. MSFT’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (13.245) is normal, around the industry mean (30.859). P/E Ratio (38.386) is within average values for comparable stocks, (159.968). Projected Growth (PEG Ratio) (2.153) is also within normal values, averaging (2.755). Dividend Yield (0.007) settles around the average of (0.084) among similar stocks. P/S Ratio (13.928) is also within normal values, averaging (57.731).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to slightly better than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a developer of software and harware products
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