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The flagship of Microsoft Corp, your cloud computing business Azure, reported sales growth of less than 50% on Wednesday for the first time, causing the tech giant’s shares to drop 3%.
Microsoft said revenue in its Intelligent Cloud division rose 17% to $ 13.4 billion, with 47% growth from Azure. Analysts on average expected revenue of $ 13.090 million, according to IBES data from Refinitiv.
Azure’s growth rate is the best direct measure of competition with rivals such as Amazon Inc AWS and Alphabet Inc, as Microsoft does not separate Azure revenue.
Microsoft’s total revenue increased 13% to $ 38.03 billion in the fourth quarter ended June 30, beating estimates of $ 36.5 billion, according to IBES data from Refinitiv.
The increased revenue was fueled by earnings from its Personal Computing unit, as more people globally turned to its products to work and play remotely during the confinement caused by the coronavirus.
The unit’s revenue, the highest from sales, rose 14% to $ 12.9 billion, beating analyst estimates of $ 11.46 billion. The unit includes the Windows operating system and the Xbox game console, among others.
Microsoft also said that its professional networking site LinkedIn was hit by weak labor markets and reductions in advertising spending.
The company’s profit fell to $ 11.2 billion, or $ 1.46 per share, from $ 13.190 million, or $ 1.71 per share in the same period last year.
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