Microsoft Earning Less Than Expected

Microsoft has been earning less than expected due to the decrease in computer sales. Microsoft is looking to resolve the issue in their production as well.

Highlights

Microsoft earned less than what was estimated they be earning.
Due to the decrease in the demand and sale of computers, Microsoft is suffering losses.
Microsoft made $51.9 billion in sales this quarter ending June 30.
The demand for computers is decreasing as people are going to offices.
Their production is also facing issues.

Microsoft is looking to get a less than expected profit this quarter ending June 30^th. They did $51.9 billion in sales in the quarter ending June 30^th which is up 12% from last quarter.

There are factors which affected the earnings of Microsoft. They are as follows: –

Due to the end of the pandemic, computer demand has decreased a lot.
Computer sales are going slow as people are called back to their offices.
Microsoft had issues with production as China lowered production due to the pandemic.
Last year the computer market saw its biggest dip in history with a 13% drop.
The currency also played a role in the profit, as there were issues with the currency value right now.

The demand for computers was very high during the pandemic as people needed computers to work from home. As the pandemic is slowly getting away the demand for computers is also slowing down.

China, where Microsoft has their production factory setups, is having to put lockdowns on a temporary basis now and then, and that is making the production process slower and slower.

Due to China’s production issues, the sale of windows OS has suffered around $300 million. As the pandemic is easing down the demand for computers fell down to 13% which is the highest ever computer demand has ever seen.

Microsoft’s Xbox hardware also fell 11% from the last quarter and their content and service revenue also declined by around 8%.

Microsoft issued a statement that they saw that they would suffer difficulties but not this much. They will recover the decline and make more of it in next quarter.