The Key Debate for Microsoft and the Stock Market Is How Bad Things Are for Azure

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The key to why the stock market is selling off on Wednesday comes down to one comment on the


earnings call. The stock was 5% higher in after-hours trading on Tuesday, until CFO Amy Hood provided a deeply disappointing short-term forecast for the Azure cloud computing business.

Results for the December quarter, disclosed Tuesday evening, were basically fine, although as Piper Sandler analyst Brent Bracelin noted, the company’s 7% growth rate in constant-currency marked the first quarter below 10% in five years.