Microsoft stock tanks on weak quarterly results

NEW YORK — Microsoft stock took a big hit on Friday after the Redmond-based software giant reported disappointing results for the latest quarter. The stock fell the most in more than a decade after the company on Thursday wrote off nearly $1 billion for expected losses on its new tablet and reported declining revenue for its Windows operating system..

Friday the price of shares was down 11.4 percent from Thursday, closing at $31.40.

The quarter’s results, which fell below Wall Street’s expectations, included a large write-off for Microsoft Corp.’s surface RT business. A poor reception for Windows 8 contributed to a revenue drop in the company’s operating system software unit.

Microsoft “struggled far more than we had expected,” said Cowen &Co. analyst Gregg Moskowitz, who downgraded the company’s stock to “Neutral” from “Buy,” and cut his price target to $33 from $38.

The analyst said in a note to investors that he is “much less confident” that the company can deliver healthy growth in the near future due to the magnitude of the Windows decline, the challenges for Surface, pressure on profit margins and the company’s reorganization plans.

Microsoft announced a major reorganization late week, aimed at helping it transform into a “devices and services” company that is less reliant on providing software for personal computers. But the earnings miss raised new questions as to whether the transition will succeed.

Janney Capital Markets analyst Yun Kim called the quarter’s results “weak,” with all five of Microsoft’s divisions reporting revenue below Wall Street’s expectations. Windows, Kim added, came in “especially weak,” reflecting not only the ongoing decline of the PC, but lack of demand for Surface and other tablets running Windows.

More in Herald Business Journal

Why real estate investors are watching self-driving cars closely

With decisions on real estate made years in advance, could self-driving cars change how we live?

More than 60 Boeing 737s per month: Can suppliers keep up?

There was lots of talk this week about the prudence and pressures of soaring production rates.

Safe saves Everett Office Furniture’s future after fire

The business was able to reopen because vital paperwork was preserved.

Developer proposes an 18-story building in Lynnwood

It would be the second-tallest in the county and include apartments with retail space.

Even as stock markets shook, many investors held steady

Older investors were buying stocks, but at a lower rate than their younger counterparts.

Snohomish County business licenses

PLEASE NOTE: Business license information is obtained monthly from the Washington Secretary… Continue reading

New Everett mayor speaks out about business in city, region

Q&A: Cassie Franklin on what can be done to get Boeing to build the 797 here and attract new industries.

Aerospace analyst explains how he’ll help state’s Boeing bid

Richard Aboulafia will deliver a report on Washington’s strengths and weaknesses in landing the 797.

Air passenger traffic growing faster than airplane capacity

“Our customers are in a good place,” a Boeing marketing executive says of the airlines.

Most Read