The software maker's fiscal fourth-quarter results failed to meet Wall Street's expectations.
The company did what it was supposed to.
Microsoft's revenue increased by 12% year over year in the quarter, which ended on June 30, compared with 18% growth in the previous quarter Net income increased 2%.
The Intelligent Cloud segment of Microsoft generated over 20 billion dollars in revenue. It was up 20% and below the consensus of $21.10 billion.
Revenue from cloud services grew by 40% compared to the previous quarter. CNBC had predicted 43.1%, while StreetAccount had predicted 43.4%. Microsoft does not give a dollar figure for the revenue.
The Productivity and Business Processes segment of Microsoft made $16.60 billion. The StreetAccount consensus was $16.66 billion, but it was up more than 10%.
The More Personal Computing segment includes the Windows operating system, the Bing search engine and Surface devices. The revenue was slightly higher than the StreetAccount consensus. Excluding traffic acquisition costs, Microsoft said search and news advertising rose 18%.
The sales of Windows licenses to device makers fell. Logistical disruptions in the quarter contributed to a 12.6% decrease in quarterly PC shipments, a key input for that metric, according to a research report.
Microsoft reduced its guidance for income and revenue because of foreign exchange rates. The company has introduced services to help customers deal with security incidents.
Microsoft stock has fallen 25% so far this year, compared with a decline of 18% for the S&P 500.
The results will be discussed with analysts and guidance will be given on a website. There is an hour and a half later.
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In the mega-cap tech complex, Microsoft has the better value, according to a report.
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