Alphabet shares drop 6% after company reported slowest sales growth since 2013 – while Microsoft’s cloud revenue disappoints in another grim sign for beaten-down tech sector
Google’s parent company Alphabet missed expectations with its latest earnings report, while Microsoft posted mixed results with cloud revenue coming in lower than Wall Street had hoped.
The two tech titans released their third-quarter financial results after the closing bell on Thursday, sending Alphabet shares down nearly 6 percent and Microsoft stock sliding more than 2 percent.
The results were a disappointment for investors and a bellwether for the tech sector, which has led Wall Street’s losses this year as interest rates rise and fears of a sharp downturn increase. Facebook parent Meta and Amazon will report later this week.
Alphabet reported revenue of $69,092 for the three months ending in September, missing expectations and marking the company’s slowest annual revenue growth since 2013.
Google’s parent company Alphabet missed expectations with its latest earnings report
Net income of $13,910 and earnings per share of $1.06 also missed the Wall Street expectations, with analysts predicting EPS of $1.25.
Sundar Pichai, CEO of Alphabet and Google, said in a statement: ‘We’re sharpening our focus on a clear set of product and business priorities.’
‘We are focused on both investing responsibly for the long term and being responsive to the economic environment,’ he added.
Meanwhile, Microsoft posted slight beats on both the top and bottom line, but sparked investor concerns after its cloud computing business grew slower than analysts expected.
Microsoft’s revenue of $50.12 billion beat expectations of $49.61 billion and marked an 11 percent increase from last year.
The company’s earnings of $2.35 per share also edged out the $2.30 expected on the Street, but marked a 13 percent decline from last year.
‘In a world facing increasing headwinds, digital technology is the ultimate tailwind,’ said Satya Nadella, chairman and chief executive officer of Microsoft.
‘In this environment, we’re focused on helping our customers do more with less, while investing in secular growth areas and managing our cost structure in a disciplined way.’
Developing story, more to follow.
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