Microsoft - Before the Figures: These Guidelines are Important!
Earnings Quarter in Focus
After the closing bell on Tuesday, Microsoft will announce its earnings figures for the past quarter. Analysts expect a decline in earnings per share for the first time since 2016. Although the share price has almost halved since the beginning of the year, investors remain cautious before the figures are announced. The market reaction will provide initial indications of the future direction of the share price.
Caution is certainly advisable before the figures are released, as Microsoft is facing numerous challenges. These include the strong US dollar, which is making products more expensive for customers outside the country, as well as slowing demand for personal computers. Moreover, increasing competition from the cloud services of Amazon, Alphabet's Google, and others is also weighing on the outlook.
Important Guidelines for Investors
Outlook for Cloud Business
Microsoft's cloud business, Azure, is a key growth driver for the company and investors will be paying close attention to its performance. It is currently growing faster than Amazon's AWS and Google's cloud services, but it is also facing increasing competition. Investors will be looking for any signs that the growth rate is slowing or that margins are coming under pressure.
Windows Business under Pressure?
The Windows business is another area of concern, as it has been in decline for several years. Microsoft has tried to revive growth in this business, but the results have been mixed. Investors will be looking for any signs that the decline is continuing or even accelerating, as this could have a significant impact on the company's overall profitability.
Share Buybacks and Dividends
In addition to the financial results, investors will also be watching Microsoft's plans for share buybacks and dividends. The company has been a reliable dividend payer in recent years, and investors will be looking for any signs that this policy is changing. Share buybacks can also have a positive impact on the share price, as they reduce the number of shares outstanding and increase the value of each share.
Conclusion: Critical Figures for Microsoft
The upcoming earnings figures from Microsoft are critical for the company and its investors. The results will provide insights into the challenges the company is facing and its ability to overcome them. Investors should carefully consider the company's outlook for its cloud business, Windows business, and share buyback and dividend policies before making any investment decisions.
