Editor's PickMarket News

Microsoft claws back losses after Azure concerns quelled

Microsoft Corporation (NASDAQ:MSFT) recovered from the losses made on Tuesday night after posting its fourth-quarter results. The tech giant shed 3% in after-hours trading after investors were disappointed by slower growth than expected at the cloud-services business Azure. However, it’s likely that the earnings call quelled some concerns, according to analysts at Deutsche Bank. READ: Microsoft tipped for bumper quarter as cloud adoption accelerates Results for the quarter ended 30 June beat forecasts, with revenue up 21% to US$46.2bn and net income up 47% to US$16.5bn. Revenue in Intelligent Cloud was up by a third to US$17.4bn, with Azure rising 51%. Cloud remains the core of the bull story, according to Wedbush, as Microsoft remains a major beneficiary of the working from home trend with its Azure and Office 365 franchise. “With 40% of workloads in the cloud today poised to hit 55% by 2022, we believe this overall WFH and hybrid environment shift has accelerated the cloud trend as more chief information officers (CIOs) are being forced to face the new normal/reality for their respective organizations looking ahead,” the broker said. “With this highest IT priority front and centre, we believe 85%-90% of these cloud deployments have already been green-lighted by CIOs and healthy cloud budgets already in place for 2021 with Redmond firmly positioned to gain more market share in this cloud arms race.” Shares were changing hands at US$287.12 in after-hours trading, having recovered from lows of US$277 in just a few hours.