Microsoft Q3 Results: All you need to know
Microsoft share price jumped 8% in after market trading on Apr 25, 2023 after the technology major reported robust results for the quarter ending March 2023.
Microsoft’s revenues and net profit jumped, primarily taking support from its cloud computing business - Azure, which continues to remain as one of the major contributors to the company’s revenue growth.
Microsoft share prices have gained about 15% so far this year, according to data up to the closing session of Apr 25, 2023 and have risen about 2% over the past one year.
Technology stocks have particularly been battered over the past year on rising interest rate pressures.
Why does this happen? - it is because technology shares are generally valued on their future potential to generate revenues and when interest rates rise, it has a negative effect on future earnings. Also as interest rates rise, safer instruments like bonds see more demand as they provide higher and safer returns.
Microsoft Q3: Historical share price performance
Microsoft Q3: Revenue
Revenue rose above estimates: Microsoft reported a revenue of $52.9 billion, beating analyst expectations. The jump in revenues primarily came in from strong performance from its cloud computing business - Azure, which contributed about 42% to Microsoft's total revenues.
Other revenue streams like Productivity and Business Processes and Personal Computing which together comprise of Windows operating system, LinkedIn, Office 365 among other also reported significantly higher jump from the corresponding quarter last year.
| Q3FY23 | Q3FY22 | % change | |
| Total Revenue | $52.9 billion | $49.4 billion | +7% |
Microsoft Q3: Net Profit
Microsoft beats net profit estimates: Microsoft reported a net profit of $2.45 per share in the fiscal third quarter, beating analyst expectations of $2.23.
Strong revenue growth across its various business verticals coupled with prudent expenses growth helped push profits higher.
| Q3FY23 | Q3FY22 | % change | |
| Net Profit | 18.3 billion | $16.7 billion | 9.6% |
Microsoft Q3: Dividends
Microsoft in its earnings presentation mentioned that it returned $9.7 billion back to its shareholders in form of stock repurchases and dividends.
Microsoft Q3: Analyst View
- JP Morgan has a ‘buy’ rating on the firm with a share price target of $315, implying a 14.5% upside from its closing price on April 25.
- Wells Fargo has a ‘buy’ rating on the firm with a share price target of $345, implying a 25% upside from its closing price on April 25.
- has a ‘buy’ rating on the firm with a share price target of $335, implying a 21% upside from its closing price on April 25.
This is not investment advice. Investments in the securities market are subject to market risk, read all the related documents carefully before investing. Past performance is not indicative of future returns.