Microsoft Cloud Growth Propels Quarterly Sales, Earnings

tech.hindustantimes.com:

Microsoft Corp. reported quarterly sales and earnings that topped analysts’ projections, fueled by robust growth in cloud-services demand. Shares jumped as much as 6.9% in late trading.

Revenue in the third quarter, which ended March 31, rose 18% to $49.4 billion, the Redmond, Washington-based software maker said Tuesday in a statement. Net income rose to $16.7 billion, or $2.22 a share. That compared with average analyst projections for $49 billion in sales and $2.19 a share in earnings, according to a Bloomberg survey.

Chief Executive Officer Satya Nadella has built up the company’s two main cloud businesses, Azure and internet-based versions of Office, into steady growth engines that help insulate Microsoft from supply-chain weakness that hurt the availability of PCs and Xbox consoles. Azure -- behind only Amazon.com Inc. in the market for cloud infrastructure services, computing power and storage delivered via the internet -- posted 46% growth, matching the rate in the second quarter and meeting estimates.

“Investors were banking we’d get back on a growth trajectory trend for Azure, as opposed to the deceleration we had in the second quarter,” said Dan Morgan, a senior portfolio manager at Synovus Trust Co., which owns shares of Microsoft.

Microsoft shares alternated between gains and losses in extended trading following the report, eventually soaring as high as $289 as investors digested the company’s results. The stock had declined 3.7% to $270.22 at Tuesday’s close in New York. While the shares jumped 51% in 2021, they have fallen 20% so far this year amid a rout in large technology stocks.

Chief Financial Officer Amy Hood said Xbox hardware revenue, which rose 14%, came in ahead of her expectations, as Microsoft has