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WASHINGTON, Jan. 25 (AP) — Microsoft Corp on Tuesday reported a 12% drop in profit for the October-December quarter, reflecting economic uncertainty that led to its decision to cut 10,000 jobs.
The company reported quarterly profit of $16.43 billion, or $2.20 per share.
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Excluding one-time items, the Redmond, Wash.-based company said it earned $2.32 a share, beating Wall Street expectations for adjusted earnings of $2.29 a share.
The software maker reported revenue of $52.75 billion for the October-December period of its second fiscal quarter, up 2% from a year earlier.
Analysts polled by FactSet expected Microsoft to report revenue of $52.99 billion in the October-December quarter.
Microsoft last week blamed “macroeconomic conditions and changing customer priorities” for its decision to lay off nearly 5 percent of its global workforce.
It is one of a number of tech companies announcing mass layoffs, including Google, Amazon, Salesforce and Facebook parent Meta.
Microsoft’s personal computing business, centered around its Windows software, is widely expected to continue its deterioration from earlier last year amid economic uncertainty and sluggish demand.
The company receives licensing revenue from PC manufacturers who install the Windows operating system on their products.
Market research firm Gartner reported that worldwide PC shipments in the October-December quarter fell 28.5% from the same period in 2021, the largest quarterly decline since Gartner began tracking the market in the 1990s.
Factors reducing consumer demand for PCs include higher inflation, higher interest rates, expectations of a global recession and the fact that many people have already purchased new computers during the COVID-19 pandemic, Gartner said.
Analysts are keeping a close eye on results from Microsoft’s other big business units — its cloud computing unit and its Office suite of productivity software — amid weakness in the PC market.
To further integrate the latest advances in artificial intelligence technology into its products, Microsoft on Monday announced a “multi-year, multi-billion-dollar investment” in artificial intelligence startup OpenAI, which is ChatGPT and other computers that can write readable text and computer code. Maker of tools to generate new images. (Associated Press)
(This is an unedited and auto-generated story from a Syndicated News feed, the content body may not have been modified or edited by LatestLY staff)
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