Microsoft Earnings Beat Puts Cloud Computing ETF in Spotlight

Microsoft reported its second-quarter earnings on Thursday as the software giant ousted analyst expectations with $1.37 earnings per share as opposed to Wall Street forecasts of $1.21 EPS. Notably, for the first time in three years, Microsoft’s cloud computing segment added more revenue versus the core productivity and business processes segments.

Microsoft’s Intelligent Cloud segment is shored up by products like Azure, SQL Server, Windows Server, Visual Studio, System Center, consulting services and support. In particular, the growth of Azure is at 64 percent on an annualized basis in the fiscal fourth quarter.

Cloud Computing

As more and more companies are shifting their business processes to cloud computing, the demand for products like Azure will continue to experience growth.

“Our partner conversations this quarter continued to emphasize Azure’s momentum, which are enabling the company to significantly outpace the overall market’s growth as they see Azure contract commitments seeing significant uplift in terms of contract value and duration,” Goldman Sachs analysts led by Heather Bellini wrote in a Thursday note.

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