Microsoft Reports $4.97B Earnings But Misses Expectations

Microsoft announced a 10% increase in revenue for its fourth quarter of 2013 on Thursday, bringing in a revenue of $19.90 billion, up from the same period last year. But the numbers missed expectations of $20.72 billion and caused the stock to drop 3% amid the news.

Microsoft also reported a net income of $4.97 billion. The company said the results include a $900 million charge related to Surface RT inventory adjustments.

“While our fourth-quarter results were impacted by the decline in the PC market, we continue to see strong demand for our enterprise and cloud offerings, resulting in a record unearned revenue balance this quarter. We also saw increasing consumer demand for services like Office 365, Outlook.com, Skype, and Xbox LIVE,” said Amy Hood, chief financial officer at Microsoft, in a statement. “While we have work ahead of us, we are making the focused investments needed to deliver on long-term growth opportunities like cloud services.”