Microsoft (MSFT) Set to Surpass Earnings Expectations Once More

For investors targeting robust returns on their portfolios, earnings performance is often a reliable indicator. In the context of such markers, Microsoft Corporation MSFT stands out as a formidable contender with a commendable track record of exceeding earnings estimates. Furthermore, as the next quarterly earnings report draws near, MSFT appears to be aligning perfectly with the critical factors that historically predicate an earnings beat.

Anatomy of an Earnings Surprise

Why does Microsoft consistently outshine earnings expectations? The answer may lie in the synergy of their vast product ecosystem and agile corporate strategy. Known universally for their Microsoft Windows operating systems, Microsoft Office suite, and an array of consumer hardware including the Xbox and Surface devices, MSFT has cemented its prowess in both software and hardware realms.

The Big Picture in Revenue

Ranked No. 21 on the 2020 Fortune 500 list by total revenue, Microsoft's formidable business footprint is evident. Besides being the largest software maker by revenue as of 2016, it is also regarded as one of the 'Big Five' in the U.S. information technology sector alongside tech titans like Google, Apple, Amazon, and Facebook. Such financial robustness offers a reassuring context for MSFF's anticipated earnings outperformance.

The Ingredients for Success

A blend of solid Zacks Rank and positive Earnings ESP (Expected Surprise Prediction) has historically been an indicative duo for earning beats. MSFT not only features an advantageous Zacks Rank but also boasts a positive Earnings ESP, a statistically significant driver for surpassing market expectations.

earnings, technology, expectations