Microsoft Shares Spike
Shares in Microsoft are trading sharply higher ahead of the open today after the company reported a bumper set of Q1 earnings yesterday. The results, which came in after a session of losses, saw the company posting Q1 EPS of $2.45, vs $2.23 expected, on revenues of $52.857 billion vs $51.019 billion expected. Microsoft shares spike after-hours in reaction the results are now trading around 8% higher ahead of the open.
Analyst Forecasts Surpassed
Looking at the breakdown of the results, which marked an increase both quarter-on-quarter and year-on-year, the near-term outlook for Microsoft looks promising. Revenues from Azure and wider cloud services grew by 27% in Q1, above analyst forecasts. Meanwhile, Microsoft’s Productivity and Business Process segment saw gains of 11% quarter-on-quarter, again beating analyst forecasts.
AI Excitement
The main focus with this latest round of earnings, however, was on AI. With AI developments dominating news-flow recently, traders were keen to get an insight into how Microsoft’s AI business is progressing and what its future plans are. On this front, the group noted that it continues to invest in its AI infrastructure and is confident of its AI business driving growth going forward as demand continue to grow across its various customer bases. Commenting on its role in the AI drive, CEO Satya Nadella said “We feel we have a good lead and we have a differentiated offering up and down the stack.”
Technical Views
Microsoft
Microsoft shares are now trading above the 292.46 level resistance, testing the top of the bull channel which has framed the move off YTD lows. While above this level, the focus is on a continuation higher and a test of the 315.38 level next. To the downside, 265.55 remains key support to watch.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.