Microsoft (MSFTMore) plans to release second-quarter earnings after Tuesday’s bell. This comes a day after he revealed he was involved in a multi-year, multi-billion dollar business. Investing in OpenAI Amazon (AMZN) to Google (goog, Google). The announcement also follows the company’s decision to cut about 10,000 jobs to deal with cloud growth and slowing PC sales at his company.
Here’s what analysts are expecting this quarter, and how it compares to the company’s results for the same quarter last year, compiled by Bloomberg.
-
Earnings: Expected $52.9 billion compared to $51.7 billion in the second quarter of last year
-
Adjusted EPS: $2.30 expected vs $2.48 in Q2 last year
-
Productivity and business processes: Expected $16.8 billion compared to $15.9 billion in the second quarter of last year
-
Intelligent cloud: $18.3 billion in the second quarter of last year, versus an expected $21.4 billion
-
Other Personal Computing: Expected $14.7 billion compared to $17.4 billion in the second quarter of last year
Microsoft made headlines on Monday by announcing it would invest billions in OpenAI, creators of the much-talked-about ChatGPT chatbot. Microsoft also invested his $1 billion in the company in 2019.
The investment is expected to help Microsoft further differentiate its cloud offerings from competitors such as Amazon and Google. The company is also said to be bringing the technology to the Bing search engine. It’s a move that could threaten Google’s search dominance.
But Microsoft is also dealing with sluggish PC sales compared to the explosive growth the company saw during the pandemic.
Analysts expect Microsoft’s More Personal Computing segment to see revenue grow 15.5% year over year. According to GartnerPC sales fell off a cliff in Q4, down 28.5% year-over-year and down 16.2% for 2022 as a whole.
Cloud sales are also slowing as businesses hold back spending amid high inflation and interest rates. Growth in Microsoft’s Intelligent Cloud division is expected to slow to 16.9% from 26% in the second quarter of last year.
[Microsoft] Saw deal moderation [small medium business] Customer segments in F1Q (also seen in F4Q),” Jefferies analyst Brent Thill wrote in a note ahead of Microsoft’s earnings.
“In Q1 on the per-user side of the business, the weakness was related to SMB, but the softness of Azure was broader. Years of technology headwinds.”
The company is also continuing efforts to acquire video game giant Activision Blizzard for $69 billion. So far, the Federal Trade Commission, the UK’s Competition and Markets Authority and the EU’s European Commission have either filed complaints or are working to stop the deal.
Sign up for Yahoo Finance’s Tech newsletter
Other works by Dan
Any tips? Email Daniel Howley ([email protected]). Follow him on Twitter. @Daniel Howley.
Find the latest tech business news, reviews, and helpful articles on tech and gadgets here
Read the latest financial and business news from Yahoo Finance
