Beautiful Virgin Islands

Wednesday, Oct 08, 2025

Microsoft blames turbulent economy as it misses profit targets

Microsoft blames turbulent economy as it misses profit targets

Tech giants Microsoft and Alphabet report their financial results in the US, with both seeing challenges in the current economy.

Microsoft missed its profit targets on Tuesday, blaming the turbulent economy.

The tech giant reported a fourth-quarter profit of $16.7bn (£13.8bn) - or $2.23 per share.

Revenue came in at $51.9bn (£43.1bn), which was up 12% from last year.

Analysts had been forecasting $2.29 per share and revenue of $52.94bn (£44bn), according to FactSet.

Microsoft blamed "evolving macroeconomic conditions and other unforeseen items" for its financial performance.

It cited supply challenges in China due to strict COVID-19 lockdowns, a deteriorating personal computer market, and the winding down of its operation in Russia as a reaction to that country's invasion of Ukraine.

Alphabet Inc, meanwhile, had a more positive showing, with revenue nearly in line with analysts' expectations.

The Google parent company said it saw second-quarter revenue rise to $69.69bn (£57.9bn) from $61.88bn (£51.3bn) a year earlier - nearly in line with the average expectation of $69.88bn (£58bn).

'Ad revenues still rising despite concerns of an overly-harsh tapering of demand'


Google's ad business was 81% of quarterly revenue, with sales coming in at $56.29bn (£46.8bn) - just below the average estimate of $56.67bn (£47.1bn).

Investors had expected ad revenue to falter as companies cut budgets to cope with rising costs.

Companies such as Alphabet are increasingly bringing in less cash from foreign revenue, due to the strong US dollar, and its shares have fallen more than 27% this year.

Overall profit was $16bn (£13.3bn) - or $1.21 per share, below the average estimate of $1.29.

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said: "Alphabet's unshakeable presence in our daily lives means it falls into the essentials bucket for marketing teams, which is why ad revenues are still rising despite concerns of an overly-harsh tapering of demand.

"A positive reaction from the latest quarterly numbers has been incredibly hard-won, given the negative market sentiment surrounding broader tech.

"Alphabet's essential status for marketers makes it more able to stomach inflation, as its customer base is about as sticky as they come in the sector. However, it's not completely immune to residual issues from a tough economic backdrop."

Shares of Microsoft were down 0.5% in after-hours trading, while Alphabet was up 3% following the companies' results.

Microsoft ended the regular session down 2.7% and Alphabet ended 2.3% lower on the day.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
France: Less Than a Month After His Appointment, the New French Prime Minister Resigns
Hungarian Prime Minister Viktor Orbán stated that Hungary will not adopt the euro because the European Union is falling apart.
Sarah Mullally Becomes First Woman Appointed Archbishop of Canterbury
Mayor in western Germany in intensive care after stabbing
Australian government pays Deloitte nearly half a million dollars for a report built on fabricated quotes, fake citations, and AI-generated nonsense.
US Prosecutors Gained Legal Approval to Hack Telegram Servers
Macron Faces Intensifying Pressure to Resign or Trigger New Elections Amid France’s Political Turmoil
Standard Chartered Names Roberto Hoornweg as Sole Head of Corporate & Investment Banking
UK Asylum Housing Firm Faces Backlash Over £187 Million Profits and Poor Living Conditions
UK Police Crack Major Gang in Smuggling of up to 40,000 Stolen Phones to China
BYD’s UK Sales Soar Nearly Nine-Fold, Making Britain Its Biggest Market Outside China
Trump Proposes Farm Bailout from Tariff Revenues Amid Backlash from Other Industries
FIFA Accuses Malaysia of Forging Citizenship Documents, Suspends Seven Footballers
Latvia to Bar Tourist and Occasional Buses to Russia and Belarus Until 2026
A Dollar Coin Featuring Trump’s Portrait Expected to Be Issued Next Year
Australia Orders X to Block Murder Videos, Citing Online Safety and Public Exposure
Three Scientists Awarded Nobel Prize in Medicine for Discovery of Immune Self-Tolerance Mechanism
OpenAI and AMD Forge Landmark AI-Chip Alliance with Equity Option
Munich Airport Reopens After Second Drone Shutdown
France Names New Government Amid Political Crisis
Trump Stands Firm in Shutdown Showdown and Declares War on Drug Cartels — Turning Crisis into Opportunity
Surge of U.S. Billionaires Transforms London’s Peninsula Apartments into Ultra-Luxury Stronghold
Pro Europe and Anti-War Babiš Poised to Return to Power After Czech Parliamentary Vote
Jeff Bezos Calls AI Surge a ‘Good’ Bubble, Urges Focus on Lasting Innovation
Japan’s Ruling Party Chooses Sanae Takaichi, Clearing Path to First Female Prime Minister
Sean ‘Diddy’ Combs Sentenced to Fifty Months in Prison Following Prostitution Conviction
Taylor Swift’s ‘Showgirl’ Launch Extends Billion-Dollar Empire
Trump Administration Launches “TrumpRx” Plan to Enable Direct Drug Sales at Deep Discounts
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
×