The Redmond group (northwestern United States) saw its growth decelerate and its profits decline in the last quarter of 2022.

From October to December (second quarter of its staggered fiscal year), it achieved a turnover of 52.7 billion dollars, or +2% over one year, while it is used to double-digit growth .

Its net profit stood at 16.4 billion, down 12% year on year, according to its earnings release released on Tuesday.

These figures initially reassured the market, which expected worse: Microsoft took around 4% on Wall Street during electronic trading after the close of trading.

But the stock lost 1.31% just after the analyst conference call, during which the company said it expects revenue of between $50.5 billion and $51.5 billion for the current quarter, less than discounted by the market.

Microsoft expects weaker demand than in 2022 for its personal computer business, such as its Windows operating system.

Above all, the growth of remote computing (cloud) should continue to slow down, in particular that of the Azure platform.

The "intelligent cloud" activity, which brings together its servers and data analysis services, brought in $ 21.5 billion in the second quarter of its staggered financial year (+ 18% over one year).

Azure carried the business but with lower growth than usual, at 31%.

Savings and investments

"Some cloud contracts could be scaled back as companies re-evaluate their data center plans" because of budget challenges, notes Wedbush's Dan Ives.

But, according to this analyst, the appetite of the government and the army for these infrastructures is undeniable and many companies have not yet made their digital transition.

“We believe that the transition to the cloud (of companies and organizations) remains below 50% and therefore represents a massive opportunity for Microsoft” despite the poor economic situation, he specifies.

Microsoft wants to expand its partnership with OpenAI, a specialist in artificial intelligence © Lionel BONAVENTURE / AFP/Archives

The company announced on January 18 the dismissal by the end of March of nearly 5% of its workforce, or around 10,000 employees, to cope with economic uncertainty and changing priorities of its customers.

A "difficult choice", explained boss Satya Nadella in a letter to employees, but necessary "in a sector that does not forgive those who do not adapt to platform changes".

The group also indicated on Monday that it would invest "several billion dollars" to expand its partnership with the specialist in artificial intelligence (AI) OpenAI, creator in particular of the conversational robot ChatGPT, which arouses enthusiasm and dread even at the giant. Google.

Microsoft will “transform the most advanced AI models into a new computing platform,” Mr. Nadella promised, quoted in the earnings release on Tuesday.

He also hopes to finalize the takeover of video game giant Activision Blizzard by the end of the year, despite the obstacles posed by American and European regulators.

The US competition authority (FTC) launched lawsuits in December to block the publisher's $ 69 billion acquisition of titles such as "Call of Duty" and "Candy Crush".

The European Union has opened an investigation to find out whether the transaction would make Activision games exclusive to the Xbox, a game console marketed by Microsoft.

© 2023 AFP