MS Q4 Cloud Revenue Falls Short of Estimates... After-Hours Stock Down 5%

Revenue Reaches $69.6 Billion, Earnings Per Share at $3.23
Cloud Revenue Including Azure Totals $25.5 Billion

Microsoft (MS) announced on the 29th (local time) that its revenue for the fourth quarter of last year was $69.63 billion (approximately 100.6154 trillion KRW), and earnings per share were $3.23 (about 4,667 KRW).

The Wall Street estimates compiled by market research firm LSEG predicted revenue of $68.78 billion and earnings per share of $3.11, indicating that MS's actual results were higher.

Revenue increased by 12% compared to the same period last year, and net income rose 10% from $21.87 billion to $24.11 billion. However, revenue from the Intelligent Cloud segment (including cloud service Azure) was recorded at $25.54 billion, a 19% increase. This figure fell short of the analyst consensus average of $25.83 billion surveyed by market research firm StreetAccount.

MS stated that Azure grew by 31%. The growth rate in the previous quarter was 33%, and the analyst estimates surveyed by CNBC and StreetAccount were 31.9% and 31.1%, respectively. MS explained that 13 percentage points of Azure's growth rate were driven by artificial intelligence (AI).

MS Chief Financial Officer (CFO) Amy Hood said during a conference call with investors after the earnings announcement, "We expect Azure's growth rate in the first quarter of this year to be between 31% and 32%." This is lower than experts' forecast of 33%. She added regarding cloud division revenue, "We are still impacted by insufficient data center capacity to meet customer demand."

MS Chief Executive Officer (CEO) Satya Nadella said, "The current revenue forecast for the AI business is $13 billion, representing a 175% increase compared to the previous year."

MS shares closed down 1.09% in regular trading but showed a decline of around 5% in after-hours trading following the earnings announcement.