Generative AI

<div class="textg" style="text-align: justify; font-weight: lighter; line-height: 1.3em; font-size: 15px; border-radius: 3px; color: #80909a; padding: 10px; background-color: #F4F6F9; margin-bottom: 15px;">
 Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our&nbsp;<a href="https://tokenist.com/terms-of-service/" style="text-decoration:underline;color:#3c7b7b" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">website policy</a>&nbsp;prior to making financial decisions.
</div>
<p class="has-drop-cap">Wall Street is bracing for an <a href="https://tokenist.com/msft-amzn-googl-meta-earnings-this-week-what-to-expect/" rel="noopener noreferrer nofollow" class="deco-link">important week for corporate earnings</a>, with tech behemoth Microsoft (NASDAQ: $MSFT) set to report its Q3 results after the market closes on Tuesday. Three areas that might be of particular concern to analysts include the cloud segment, generative AI developments, and the Productivity and Business Processes segment. Overall, the Windows maker is expected to report earnings of $2.65 on revenue of $54.5 billion.</p>
<h3 id="azure-and-other-cloud-services">Azure and Other Cloud Services</h3>
<p>Perhaps the company’s cloud segment is the most important category analysts and investors will thoroughly examine in Microsoft’s Q3 report on Tuesday.&nbsp;</p>
<p>In particular, growth in Azure’s cloud computing business and its performance against Wall Street expectations will attract the bulk of market watchers’ attention. Over the past few quarters, Azure has <a aria-label="witnessed a slowdown (opens in a new tab)" href="https://www.business-standard.com/technology/tech-news/microsoft-s-azure-slowdown-offsets-optimism-about-ai-growth-shares-down-3-123072601357_1.html" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">witnessed a slowdown</a> as some customers explored ways to improve the efficiency of their cloud outlays.</p>
<p>In its own guidance, Microsoft expected the Azure segment to grow 25% to 26% in the September quarter, compared to the 26% recorded in the June quarter. The tech giant expects Azure to receive a 1-2% growth boost from its <a href="https://tokenist.com/microsoft-adds-openais-gpt-4-models-to-azure-government-services/" rel="noopener noreferrer nofollow" class="deco-link">AI-related efforts</a>, up from the 1.5% seen in the previous three-month period.&nbsp;</p>
<p>Derrick Wood, analyst at TD Cowen, said he expects Azure to grow “down the middle” of Microsoft’s guidance range, adding that any deviation in either direction could cause a stock price change.&nbsp;</p>
<div class="cta-referral"><img src="https://tokenist.com/wp-content/themes/thetokenist/assets/img/del/cta-referral-1.png" alt="" class="cta-referral__img" loading="lazy" decoding="async">
 <div class="cta-referral__text">
  <p>Join our&nbsp;<a href="https://t.me/thetokenist" target="_blank" rel="noopener noreferrer nofollow">Telegram group</a>&nbsp;and never miss a breaking digital asset story.</p>
 </div>
</div>
<h3 id="generative-ai">Generative AI</h3>
<p>Meanwhile, Guggenheim strategist John DiFucci said it is unlikely that the Q3 report would provide meaningful insights into its <a href="https://tokenist.com/microsoft-shifts-focus-to-ai-terminates-metaverse-division/" rel="noopener noreferrer nofollow" class="deco-link">generative AI ventures</a>. However, this category is expected to impact the MSFT stock in the mid-term.&nbsp;</p>
<blockquote class="wp-block-quote">
 <p>“We don’t expect this quarter’s results to provide a strong indication of Microsoft’s development in GenAI in either direction, which is the narrative that we believe will drive the stock’s progression over the medium term.”</p> <cite>– DiFucci said in his note. </cite>
</blockquote>
<p>Instead, the September quarter could bring potential upside for Office and Windows, adding that consensus estimates for the operating system “reflects guidance that assumes much worse PC shipments than was ever likely,” said DiFucci. The analyst anticipated some risk for the Azure business.</p> <iframe src="https://tokenist.substack.com/embed" width="100%" height="320" style="border:1px solid #EEE; background:white;" frameborder="0" scrolling="no"></iframe>
<h3 id="productivity-and-business-processes-segment">Productivity and Business Processes Segment</h3>
<p>According to consensus estimates, analysts on Wall Street expect Microsoft to generate $54.5 billion in revenue in Q3, which would mark a year-over-year increase of 8.8%. For earnings per share (EPS), analysts call for $2.65, up from $2.35 reported in Q3 2022.&nbsp;</p>
<p>One segment that may be of investors’ and analysts’ interest is the Productivity and Business Processes segment, which includes Office products, LinkedIn, and Dynamics 365. Analysts’ revenue growth estimates for this section include a 10.5% YoY growth to $18.2 billion.&nbsp;</p>
<p><em><strong>What are your overall expectations for Microsoft’s Q3? Let us know in the comments below.&nbsp;</strong></em></p>
<p>The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/3-insights-to-look-for-in-microsofts-earnings-report/">3 Insights to Look for in Microsoft’s Earnings Report</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.</p>

3 Insights to Look for in Microsoft’s Earnings Report

Table of Contents

Tokenist

Other articles published on Oct 24, 2023

Paradigm Co-Founder Steps Down Ahead of the New Fund Launch!

SHIB whales move $50 million as FOMO takes over

Coinbase Announces Sharing Source Code For Layer-2 Network

Bitcoiner Eric Wall points out Bitcoin’s price is ‘fire sale’

BlackRock's Bitcoin ETF Move Fuels Market Surge: The Lowdown

Gari Network (GARI) Price Prediction 2024, 2025, 2030, 2040, and 2050

Join our free newsletter for daily crypto updates!