Microsoft shares initially slipped 2 percent in the extended hours on Tuesday after the software giant released its third-quarter results. However, the stock bounced back, gaining more than 4 percent, after the company issued an optimistic sales outlook for the fourth quarter.
The Washington-based tech behemoth also surpassed expectations for both earnings and revenue amid strong growth across its flagship segments. Microsoft booked a profit of $2.22 per share, compared to $2.03 per share in the linked quarter of 2021. Sales also increased to $49.36 billion, from $41.71 billion in the year-ago period. Analysts were expecting Microsoft to report a profit of $2.19 per share on sales of $49 billion.
Revenue from the Intelligent Cloud segment, its most lucrative business, increased to $19.05 billion, from $15.19 billion in the same period last year, beating the consensus forecast of $18.89 billion.
The Productivity and Business Solutions segment, which includes its flagship office productivity software, contributed $15.79 billion in revenue, up from $13.55 billion last year. Analysts were expecting the segment to post revenue of $15.75 billion.
In addition, revenue from the More Personal Computing segment came in at $14.52 billion, versus $13.04 billion last year. The numbers were also above the consensus forecast of $14.3 billion.
Microsoft Corporation (MSFT) expects to generate sales in the range of $52.4 billion to $53.2 billion for the fourth quarter. The outlook is almost in line with the consensus of $52.75 billion
The updated outlook apparently sent Microsoft shares up more than 4 percent in the after-hours trading session on Tuesday. Overall, the stock has struggled to gain value so far in 2022. The company’s share price is still down about 15 percent on a year-to-date basis.
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