Microsoft (MSFT) Q2 Earnings: Taking a Look at Key Metrics Versus Estimates
Microsoft (MSFT) reported $62.02 billion in revenue for the quarter ended December 2023, representing a year-over-year increase of 17.6%. EPS of $2.93 for the same period compares to $2.32 a year ago.
The reported revenue represents a surprise of +1.62% over the Zacks Consensus Estimate of $61.03 billion. With the consensus EPS estimate being $2.76, the EPS surprise was +6.16%.
While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.
As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.
Here is how Microsoft performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
- Productivity and Business Processes - Percentage Change in Revenue Y/Y: 13% compared to the 12.5% average estimate based on nine analysts.
- Intelligent Cloud - Percentage Change in Revenue Y/Y: 20% versus 17.6% estimated by nine analysts on average.
- More Personal Computing - Percentage Change in Revenue Y/Y: 19% versus 17.8% estimated by nine analysts on average.
- Percentage Change in Revenue Y/Y: 18% versus 15% estimated by nine analysts on average.
- Revenue- Productivity and Business Processes: $19.25 billion compared to the $18.98 billion average estimate based on 11 analysts. The reported number represents a change of +13.2% year over year.
- Revenue- More Personal Computing: $16.89 billion compared to the $16.76 billion average estimate based on 11 analysts. The reported number represents a change of +18.6% year over year.
- Revenue- Intelligent Cloud: $25.88 billion versus $25.28 billion estimated by 11 analysts on average. Compared to the year-ago quarter, this number represents a +20.3% change.
- Revenue- Service and other: $43.08 billion compared to the $44.22 billion average estimate based on two analysts. The reported number represents a change of +18.9% year over year.
- Unearned revenue- More Personal Computing: $5.75 billion versus $4.28 billion estimated by two analysts on average.
- Unearned revenue- Intelligent Cloud: $17.70 billion compared to the $18.96 billion average estimate based on two analysts.
- Revenue- Product: $18.94 billion compared to the $16.80 billion average estimate based on two analysts. The reported number represents a change of +14.7% year over year.
- Unearned revenue- Productivity and Business Processes: $22.59 billion versus the two-analyst average estimate of $24.57 billion.
Shares of Microsoft have returned +9% over the past month versus the Zacks S&P 500 composite's +3.4% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>Microsoft Corporation (MSFT) : Free Stock Analysis Report
