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Here's Why Microsoft Investors Shouldn't Lose Hope After Seeing Q4 Results

Here's Why Microsoft Investors Shouldn't Lose Hope After Seeing Q4 Results

Microsoft Corporation (NASDAQ: MSFT) posted disappointing fourth-quarter numbers on Tuesday owing to the decline in Windows phone sales and $7.6 billion Nokia acquisition write-down.

However, Brent Thill, UBS managing director of software research, is bullish on the company going forward. Thill was on CNBC recently to explain why.

In The New Era

"We think Microsoft is pivoting to the right product portfolio," Thill said. "And importantly on the expense side, Amy Hood, the CFO, is taking pretty swift action. Microsoft is in the new era where they are effectively saying, 'Look, we are in products that are going to grow and have operating margin, rather than going down a lot of different courses of having multiple products that don't go anywhere.'"

Related Link: Market Update: Wednesday's Mid-Day Movers

Cleansing Will Take Time

"So, we think, they are effectively still kind of cleaning the house, if you will, from the old Microsoft, and that process is going to take time to cleanse. But over time, we do believe that they are going to produce the type of financial results that investors are looking for. So, I think, when you see the stock I thought investors thought it would be down a little bit more today."

Most Issues Are In The Numbers

"But, I think, they are putting together the right strategy, and it's just going to take time, right? The Nokia write-down, FX and a handful of other issues around the Windows 10 deferral. But most of those issues now are kind of in the numbers; I think investors are looking forward now to the next fiscal year," Thill concluded.

Image Credit: Public Domain


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