. Microsoft's Financial Revival: 27% Income Surge and Azure's Rebirth

Microsoft’s Financial Revival: 27% Income Surge and Azure’s Rebirth

Microsoft’s Financial Revival: 27% Income Surge and Azure’s Rebirth

25 Oct 2023

Microsoft ticks up on faster cloud growth and hopeful revenue forecast.

  • Microsoft saw a 27% surge in net income, attributed to cost-cutting measures by its management.
  • Notably, the growth of the company’s Azure cloud revenue accelerated after two years of slowing down.
  • Management’s revenue projection for the current quarter exceeded analysts’ expectations.

In after-hours trading on Tuesday, Microsoft’s stock surged by up to 6% following the release of the company’s fiscal first-quarter results and quarterly revenue guidance, both of which exceeded the expectations of Wall Street. Additionally, the company reported a significant increase in profit, attributed to a more restrained rate of growth in operating expenses.

Here’s how the company’s performance stacks up against the consensus among analysts surveyed by LSEG, previously known as Refinitiv:

  • Earnings per share: $2.99, surpassing the expected $2.65.
  • Revenue: $56.52 billion, exceeding the anticipated $54.50 billion.

Regarding their future outlook, Microsoft’s Chief Financial Officer, Amy Hood, stated during an analyst conference call that they are projecting second-quarter fiscal revenue to fall within the range of $60.4 billion to $61.4 billion, indicating a 15% growth. Analysts polled by Refinitiv had initially predicted revenue of $60.9 billion.

In the most recent quarter, revenue expanded by nearly 13% compared to the same period the previous year, reaching $50.12 billion, as reported. Net income also saw a notable increase, rising by 27% to $22.29 billion, up from $17.56 billion, or $2.35 per share, in the corresponding quarter of the previous year.

MICROSOFT TECHNICAL ANALYSIS DAILY CHART:

Technical Overview

Microsoft is currently trading within an up channel.

Microsoft is positioned above all Moving Averages (SMA).

The Relative Strength Index (RSI) is in the buying zone, while the Stochastic oscillator suggests a positive trend.

Immediate Resistance level: 346.35

Immediate support level: 340.36

HOW TO TRADE MICROSOFT

Microsoft’s price surged considerably, then experienced a minor retracement and correction before finding support. Subsequently, it resumed an upward trajectory. Currently, Microsoft has surpassed the previous day’s high and is trading in the vicinity of a pivotal resistance area. Further gains may be on the horizon if this zone is breached.

TRADE SUGGESTION- BUY LIMIT – 341.09, TAKE PROFIT AT- 358.65, SL AT- 330.55.