Software kingpin Microsoft late Thursday beat estimates for its fiscal third quarter, thanks to healthy cloud computing business. Microsoft stock jumped in extended trading.
The Redmond, Wash.-based company earned $2.94 a share on sales of $61.9 billion in the quarter ended March 31. Analysts polled by FactSet had expected earnings of $2.82 a share on sales of $60.9 billion. On a year-over-year basis, Microsoft earnings increased 20% while sales rose 17%.
"This quarter Microsoft Cloud revenue was $35.1 billion, up 23% year over year, driven by strong execution by our sales teams and partners," Chief Financial Officer Amy Hood said in a news release.
For the current quarter, Microsoft forecast sales of $63.5 billion to $64.5 billion. The midpoint of $64 billion was below the consensus estimate of $64.6 billion for the June quarter, according to FactSet. Microsoft said it expects Azure growth to be about the same as the March quarter.
Microsoft Stock News: Azure Growth Accelerates
Of Microsoft's three business units, Intelligent Cloud was the top performer in the March quarter. Revenue in the segment increased 21% to $26.7 billion. The unit includes server products and cloud services such as Azure.
Azure cloud infrastructure sales rose 31% year over year in fiscal Q3. That compares with 30% growth in fiscal Q2.
Microsoft's Productivity and Business Processes unit saw sales rise 12% to $19.6 billion. The division includes Office productivity software as well as the Dynamics and LinkedIn businesses.
And lastly, Microsoft's More Personal Computing unit saw sales increase 17% to $15.6 billion. The unit includes Windows PC software, Xbox video games, Surface computers, internet search and advertising.
In after-hours trading on the stock market today, Microsoft stock rose 4% to 415. During the regular session Thursday, Microsoft stock slid 2.5% to close at 399.04.
Microsoft stock is on two IBD stock lists: Long-Term Leaders and Tech Leaders. It also is one of the Magnificent Seven stocks.
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