Microsoft beats Wall Street expectations on new CEO debutFriday 25 April 2014 09.19
Microsoft's new chief executive got off to a winning start with Wall Street last night as the world's largest software company eased past analysts' profit estimates despite the pressure of falling computer sales.
Its shares rose almost 3% in after-hours trading to $40.96, keeping the stock at levels not seen since the turn-of-the-century Internet stock boom.
Microsoft shares are up about 8% since company veteran Satya Nadella took over as CEO in early February, and are up 19% since his predecessor Steve Ballmer announced plans to retire last August.
Investors are excited about Nadella's focus on mobile and cloud, or Internet-based, computing, designed to take Microsoft beyond its traditional PC-based Windows business.
Nadella's emphasis on cloud computing helped its server software business, while a softer than expected decline in PC sales limited damage to the bottom line.
Microsoft reported quarterly profits of $5.66 billion, or 68 cents per share, compared with $6.05 billion or 72 cents the same time last year.
The decline was exaggerated by deferred revenue boosting they ear-ago figure, and the latest quarter's profit beat Wall Street's average estimate of 63 cents per share.
Sales fell 0.4% to $20.4 billion, meeting analysts'average estimate.
Personal computer sales fell by as much as 4.4% in the quarter, according to the two major technology research firms, making the eighth quarter of declines in a row as tablets and smartphones gain in popularity.
That decline was likely muted by the end of Microsoft's support for its decade-old Windows XP system in early April, which appears to have prompted many people to buy a new computer.