Microsoft share price plummets 10pc after profits fall

 
Joe Hall
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Microsoft CEO Satya Nadella said Microsoft was "taking bold steps forward". (Source: Getty)
Microsoft’s share price has plummeted almost 10 per cent in morning trading on the New York Stock Exchange, after profits fell in the second quarter.
Shares opened at $42.96 after closing at $47.18 on Monday night.
In its earnings report for the quarter ended 31 December 2014, the company revealed a 10.6 per cent drop in year-on-year net income to $5.86bn.
Microsoft insisted its $26.5bn sales for the quarter were better than financial analysts had expected, but investors seem more concerned with a nine per cent drop in earnings per share, which fell to $0.71.
An earnings call to investors revealed a number of worrisome underlying trends. The company ended its support of the XP operating system last year, meaning a number of businesses switched over to a new Windows operating system all at once.
Now the rush has subsided, sales are expected to slow down. Microsoft is also making Windows 10 a free upgrade, meaning it will miss out on any added revenue there.
Chief executive Satya Nadella faces his first tough task in turning around investor sentiment since he was appointed to the role in February 2013.
Nadella said in a statement:
Microsoft is continuing to transform, executing against our strategic priorities and extending our cloud leadership.
We are taking bold steps forward across our business, and specifically with Windows 10, to deliver new experiences, new categories, and new opportunities to our customers.

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