CFDs are complex instruments. 75% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money. CFDs are complex instruments. 75% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Microsoft shares down on concerns over outlook

While second quarter earnings looked good at Microsoft, shares lost ground because of concerns for the remainder of the fiscal year. At one point shares climbed as high as the 200-day SMA, but then went into reverse.

(Video Transcript)

Microsoft Q2 numbers

Microsoft reported second quarter (Q2) fiscal numbers and the initial reaction was positive but then all of a sudden things went a little bit sour for the share price, trading all-sessions on the IG platform.

While earnings beat estimates it was a slight miss for the revenue line. Adjusted earnings were at $2.32 per share against $2.30 expected by analysts. Revenue was $52.75 billion against $53.12 billion that had been expected.

But as expected it's Microsoft's Azure cloud growth that kept earnings flowing, up 31%. A slower growth than during the same quarter this time last year but just beating analyst's expectations. But the big question is how long will it last?

Microsoft forecast third quarter revenue in its cloud business between $21.7 billion and $22 billion. Now that's just below the analyst average forecast of $22.14 billion and I think that's one of the reasons as to why we saw this market end off the highs.

Share price chart

You can see this big punch high we saw initially, taking us all the up to the 200-day moving average and then came the pullback. We ended down one and a quarter percent on the market yesterday.

The software maker taking a $1.2 billion charge as well in the quarter in connection with its decision to eliminate 10,000 employees revising its hardware lineup as well and consolidating leases.

So end effect for Microsoft last night, down one and a quarter percent.


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.