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3 Key Estimates for Microsoft's (MSFT) Earnings Report
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Shares of Microsoft (MSFT - Free Report) closed lower on Wednesday, just one day before the release of the historic tech power’s quarterly financial results. Microsoft has performed well over the last year, but heading into its earnings report, investors should know what to expect from the company’s specific business units.
Microsoft stock has surged 37% over the last year at a time when the global demand for personal computers—and related software—has plummeted. Instead, investors have rewarded Microsoft for its expansion into different growth sectors, from artificial intelligence to cloud computing.
The company now has its sights set on competing against the likes of Amazon (AMZN - Free Report) , Oracle (ORCL - Free Report) , and Google parent Alphabet (GOOGL - Free Report) in the cloud computing industry, while it also aims to become a larger player in the IoT space. With all that said, let’s look at what is in store for Microsoft this quarter.
Microsoft’s quarterly revenues are expected to climb 9.1% to reach $25.71 billion, based on our current Zacks Consensus Estimates. Meanwhile, on the other end of the income statement, Microsoft’s quarterly earnings are projected to surge 16.4% to hit $0.85 per share.
Key Business Segment Estimates
But of course, earnings and revenue are just two of the many things investors will be looking at when Microsoft reports on Thursday. In fact, it is possible that any post-earnings momentum Microsoft might experience could be driven by the performance of its three primary business segments: Productivity & Business Processes, Intelligent Cloud, and More Personal Computing.
To prepare for this, we can turn to our exclusive non-financial metrics consensus estimate file. The Zacks Consensus NFM file contains detailed estimate data for business segment metrics and non-financial metrics reported by companies. The data is acquired from digest and contributing broker models and includes the independent research of expert stock market analysts.
Microsoft’s Productivity & Business Processes unit includes the company’s Office, Office 365, LinkedIn, and Dynamics CRM businesses, which are hugely important. With that said, Productivity & Business Processes revenues are expected to hit $8.76 billion, according to these NFM consensus estimates.
This would mark 10% growth from the $7.96 billion Microsoft reported in the prior-year period. Last quarter, Productivity and Business Processes revenues surged roughly 24% to $8.95 billion.
Moving on, another segment that investors should pay close attention to is Microsoft’s growing Intelligent Cloud business, which contains its server and enterprise products, including Azure. This unit is projected to climb about 14% from $6.76 billion to reach $7.70 billion.
In the previous quarter, Intelligent Cloud revenues hit $7.79 billion, which marked a 15% climb. Investors should note that Azure revenue skyrocketed 98% last quarter.
Lastly, Microsoft’s More Personal Computing unit, which includes Windows, Gaming, Devices, and Search businesses, is expected to report revenues of $9.29 billion. This would mark a roughly 5% surge from the $8.84 billion Microsoft reported in the year-ago period.
More Personal Computing posted revenues of $12.17 billion last quarter, which marked a roughly 2% expansion. Investors should note that the massive sequential decline is largely due to holiday period sales.
Make sure to check back here for our full analysis of Microsoft’s actual results!
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
3 Key Estimates for Microsoft's (MSFT) Earnings Report
Shares of Microsoft (MSFT - Free Report) closed lower on Wednesday, just one day before the release of the historic tech power’s quarterly financial results. Microsoft has performed well over the last year, but heading into its earnings report, investors should know what to expect from the company’s specific business units.
Microsoft stock has surged 37% over the last year at a time when the global demand for personal computers—and related software—has plummeted. Instead, investors have rewarded Microsoft for its expansion into different growth sectors, from artificial intelligence to cloud computing.
The company now has its sights set on competing against the likes of Amazon (AMZN - Free Report) , Oracle (ORCL - Free Report) , and Google parent Alphabet (GOOGL - Free Report) in the cloud computing industry, while it also aims to become a larger player in the IoT space. With all that said, let’s look at what is in store for Microsoft this quarter.
Microsoft’s quarterly revenues are expected to climb 9.1% to reach $25.71 billion, based on our current Zacks Consensus Estimates. Meanwhile, on the other end of the income statement, Microsoft’s quarterly earnings are projected to surge 16.4% to hit $0.85 per share.
Key Business Segment Estimates
But of course, earnings and revenue are just two of the many things investors will be looking at when Microsoft reports on Thursday. In fact, it is possible that any post-earnings momentum Microsoft might experience could be driven by the performance of its three primary business segments: Productivity & Business Processes, Intelligent Cloud, and More Personal Computing.
To prepare for this, we can turn to our exclusive non-financial metrics consensus estimate file. The Zacks Consensus NFM file contains detailed estimate data for business segment metrics and non-financial metrics reported by companies. The data is acquired from digest and contributing broker models and includes the independent research of expert stock market analysts.
Microsoft’s Productivity & Business Processes unit includes the company’s Office, Office 365, LinkedIn, and Dynamics CRM businesses, which are hugely important. With that said, Productivity & Business Processes revenues are expected to hit $8.76 billion, according to these NFM consensus estimates.
This would mark 10% growth from the $7.96 billion Microsoft reported in the prior-year period. Last quarter, Productivity and Business Processes revenues surged roughly 24% to $8.95 billion.
Moving on, another segment that investors should pay close attention to is Microsoft’s growing Intelligent Cloud business, which contains its server and enterprise products, including Azure. This unit is projected to climb about 14% from $6.76 billion to reach $7.70 billion.
In the previous quarter, Intelligent Cloud revenues hit $7.79 billion, which marked a 15% climb. Investors should note that Azure revenue skyrocketed 98% last quarter.
Lastly, Microsoft’s More Personal Computing unit, which includes Windows, Gaming, Devices, and Search businesses, is expected to report revenues of $9.29 billion. This would mark a roughly 5% surge from the $8.84 billion Microsoft reported in the year-ago period.
More Personal Computing posted revenues of $12.17 billion last quarter, which marked a roughly 2% expansion. Investors should note that the massive sequential decline is largely due to holiday period sales.
Make sure to check back here for our full analysis of Microsoft’s actual results!
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>