The world’s software giant, Microsoft saw its shares drop about 1.66% of its value, immediately after the tech juggernaut gave unimpressive revenue guidance. That said, Microsoft printed impressive first-quarter earnings which exceeded estimates.
Microsoft’s stock price is falling on bearish comments coming from the company after it released impressive earning results, stating that its revenue guidance was weak and further hinted that it continued to face pressure from lower one-off sales of software due to the COVID-19 pandemic.
Microsoft also revealed that operating profit margins were more likely to be affected in H1 2020 year. It increased its investments in its present cash cow business (cloud computing) while seeing a deep drop off in high-margin sales on its Windows operating system for Personal computers.
It’s also important to note that the stock bears are hitting hard on the trillion-dollar market capitalized company on the bias that Microsoft further disclosed that for the final three months of 2020, its expected revenue would range between $39.6billion to $40.4billion; or a growth of 8% at the midpoint of the range, compared to global market forecasts of $40.4billion.