Microsoft disappointed with lower-than-expected Azure revenue, but still saw overall revenue growth

From Nasdaq: 2024-08-05 05:30:00

Microsoft (NASDAQ: MSFT) disappointed investors with fiscal fourth-quarter revenue from its Azure cloud computing business falling short of expectations. Despite this, the company reported a 15% year-over-year increase in revenue to $64.7 billion and EPS of $2.95, slightly beating analyst predictions. Azure experienced a 29% year-over-year revenue growth.

Capacity constraints affected Azure’s growth, prompting Microsoft to partner with companies like Oracle and Cohere to increase capacity. The company forecasts double-digit revenue and operating income growth for fiscal year 2025. For the first quarter, revenue is expected to be between $63.8 billion and $64.8 billion, with strong growth predicted for the Intelligent Cloud segment.

Although Azure’s growth was lower than expected due to capacity constraints, the business remains strong and is leading the company forward. Microsoft plans to invest in infrastructure to support Azure’s growth, a necessary move in the cloud computing space. With Azure gaining market share and attractive valuation metrics, buying the stock on a dip may be a good long-term investment opportunity.



Read more at Nasdaq: Should Investors Buy Microsoft Stock on the Dip After Azure Revenue Disappoints?