Analysts Slash Microsoft Corporation (NASDAQ:MSFT) Estimates

tags: MSFT

Analysts at the investor firm Jefferies in an updated research note announced that they have cut down their estimates for Microsoft Corporation (NASDAQ:MSFT)’s revenue and earnings in fiscal 2016 and 2017 following the latest forecast from Gartner. Gartner now expects a decline of 7.3% in PC sales this year compared to its previous figure of 1.5%. According to Jefferies MSFT‘s earnings for fiscal 2017 will be $2.78 per share, considerably below the consensus estimate of $2.88 per share.

For the first three months of the year worldwide PC shipments reached 64.8 million units, which was 9.6% lower than a year ago. This also marked the sixth quarter in a row of declining PC sales and the first time since 2007 when shipment volume had fallen below 65 million. The figures announced by Gartner do not include the potential negative effects of Britain’s decision to leave the European Union.

MSFT has been trying to move away from its reliance on consumer desktop PCs by shifting its focus on growing its cloud computing business. In the last quarter, however, this side of the company generated just 26% of the $23.79 billion in reported revenues.

Earlier this month Microsoft became the center of attention when they announced the acquisition of the professional social network Linkedin for $26.2 billion. The news was met with mixed reactions with some analysts expressing concerns about MSFT paying too much with its shareholders’ money.

After falling down on Thursday and Friday last week the stock of the company managed to close 2.09% in the green yesterday at $49.44. So far in 2016 the stock is down by 11.1%.

In early trading today MSFT climbed over $50 per share currently being up by 1.18% at $50.03.