Economy, Sci & Tech

Microsoft Misses Profit Forecasts

Microsoft Misses Profit Forecasts
Microsoft Misses Profit Forecasts

Microsoft reported results that fell short of analysts' expectations, showing its high-profile cloud business cannot quite make up for a slowing personal-computer market.

Shares fell 5% in after-hours trade to $52.92. Two of Microsoft's three major businesses showed lower operating profits, led by what Microsoft calls its intelligent cloud division, which includes its Azure cloud-services business and traditional server software. Despite revenue at Azure more than doubling, revenue in the division grew just 3%.

Microsoft executives said shortfalls in the intelligent cloud business were due to pressure on products that were tangential to the main cloud push, such as server software, which mollified some investors.

Revenue at the Redmond, Wash.-based software giant fell to $20.53 billion from $21.73 billion.

The company's net income in the third quarter ended March 31 fell to $3.76 billion, or 47 cents per share, from $4.99 billion, or 61 cents per share, a year earlier.

Adjusted revenue of $22.08 billion was just shy of the $22.09 billion analysts had expected, according to Thomson Reuters.