Analysts expect Microsoft's revenue to be $60.892 billion, adjusted net income to be $21.159 billion, and adjusted EPS to be $2.832, according to Bloomberg's unanimous expectations.
Microsoft will report its FY24 Q3 earnings after the bell on Thursday, April 25. Microsoft stock has gained about 10%. Will the upcoming earnings bring new opportunities?
Analysts expect Microsoft's revenue to be $60.892 billion, adjusted net income to be $21.159 billion, and adjusted EPS to be $2.832, according to Bloomberg's unanimous expectations.
Previous Quarter Review
Microsoft issued fiscal second-quarter results that outdid analysts’ estimates and a light quarterly revenue outlook.
Here’s how the company performed, compared with consensus among analysts polled by LSEG, formerly known as Refinitiv:
Earnings: $2.93 per share, vs. $2.78 per share expected
Revenue: $62.02 billion, vs. $61.12 billion expected
Microsoft called for fiscal third-quarter revenue between $60 billion and $61 billion, or $60.50 billion at the middle of the range. Analysts polled by LSEG had expected $60.93 billion. But the company sees lower-than-expected cost of revenue and operating expenses during the quarter, based on consensus among analysts polled by StreetAccount.
Q3 Results Outlook
Microsoft's fiscal 3Q24 results will likely continue the same theme as the past two quarters: greater contribution from AI-related Azure workloads and the lack of improvement in non-AI cloud consumption.
Though it is expected robust growth across most cloud products -- from Office 365 to Dynamics -- it's possible that forward guidance for Azure may be a bit more measured because of the worsening business climate amid increased Middle East uncertainty. Adoption rate of Office Copilot will be closely watched, given the high price of the offering.
Non-GAAP operating margins could show a modest improvement over last year, driven largely by cost-cutting even as the Activision deal pressures profitability. Management could signal a pickup in data-center-related capital expenditures given increased interest around new gen-AI initiatives.
Microsoft's $13B investment in OpenAI will avoid any formal investigation by European Union officials, according to a report by Bloomberg.
Analyst's Opinions
An in-depth analysis of recent analyst actions unveils how financial experts perceive Microsoft. The following summary outlines key analysts, their recent evaluations, and adjustments to ratings and price targets.
The latest is that Wells Fargo maintained its Overweight rating on Microsoft Corporation (NASDAQ:MSFT) and increased the stock's price target to $480 from the previous $460. The adjustment reflects the firm's confidence in the tech giant's sustainable growth and long-term favorable conditions.
Microsoft should see its per-share earnings double before the end of the decade, thanks to its strong traction in cloud computing and artificial intelligence software, Morgan Stanley says.
Analysts' evaluations of 12-month price targets offer additional insights, showcasing an average target of $489.55, with a high estimate of $600.00 and a low estimate of $450.00. This upward trend is evident, with the current average reflecting a 9.01% increase from the previous average price target of $449.07.
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