Microsoft forecasts cloud sales above expectations

REUTERS: Microsoft Corp on Wednesday forecast sales for its cloud computing services that topped analysts' estimates, even as quarterly growth slows for its Azure business.

"The guidance is strong," said Mark Moerdler, managing director of global software and senior analyst with Bernstein."There were a number of people surprised that their numbers were so good for the full year." Strength in the cloud business powered Microsoft's market value past US$1 trillion for the first time in April. However, the business faces intense competition from Amazon.com Inc's AWS and Alphabet Inc's Google.

"Azure came in at 59per cent and consensus was at 60per cent," he said."Other than that, it was a good quarter, but if you want to throw rocks at it, that is how you would do it."Microsoft also beat expectations in other segments. It forecast sales from a division that includes LinkedIn and Office software to range from US$11.3 billion to US$11.5 billion, in line with analysts' consensus estimate of US$11.4 billion.

Mike Spencer, head of investor relations for Microsoft, said Google Chromebooks continued eat into Windows revenue for entry-level laptops.

And you showed a pic of the only business unit that’s declining?

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