Why Microsoft Is the Worst Dow Jones Stock After Earnings
Microsoft stock is sinking Thursday even after the tech giant reported higher-than-expected earnings for its fiscal first quarter. Here's what you need to know.


Microsoft (MSFT) is the worst Dow Jones stock Thursday after the tech giant beat top- and bottom-line expectations for its fiscal 2025 first quarter but issued an outlook for its second quarter that failed to impress Wall Street.
In the three months ended September 30, Microsoft's revenue increased 16% year over year to $65.6 billion, boosted by 22% growth in Microsoft Cloud revenue to $38.9 billion. Meanwhile, its earnings per share (EPS) rose 10.4% from the year-ago period to $3.30.
"Artificial intelligence-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process," said Microsoft CEO Satya Nadella in a statement. "We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage."

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Microsoft's results came in ahead of analysts' expectations. Wall Street was anticipating revenue of $64.5 billion and earnings of $3.10 per share, according to CNBC.
However, sentiment turned negative toward Microsoft when it provided its second-quarter outlook for the fiscal year. Specifically, MSFT said it expects revenue in the range of $68.1 billion to $69.1 billion, which came up short of the $69.8 billion in revenue analysts are guiding for.
Is Microsoft stock a buy, sell or hold?
Microsoft has lagged the broader market in recent months and is now up 15% for the year to date on a total return basis (price change plus dividends). This compares to the S&P 500's 23% gain. But Wall Street's all-in on the blue chip stock for the long haul, and for good reason considering MSFT's impressive 20-year return.
According to S&P Global Market Intelligence, the average analyst target price for MSFT stock is $501.99, representing implied upside of more than 20% to current levels. Additionally, the consensus recommendation is Strong Buy.
Financial services firm Wedbush is one of the most bullish outfits on MSFT stock with a Buy rating and $550 price target.
"In a nutshell, we come away from this quarter more bullish (not less) after seeing this AI growth and Copilot monetization play out in real time for Microsoft," says Wedbush analyst Daniel Ives. "The bears will try to split hairs on any number but ultimately this is a tech stalwart in major growth mode... and we see no signs of slowing down based on our checks and these impressive results and outlook that give us any pause in our bullish thesis."
Ives adds that "we would be strong buyers of MSFT" following this post-earnings weakness.
Related Content
- Meta Stock Slips as Facebook Parent Ramps Up AI Spending
- Earnings Calendar and Analysis for This Week
- Analysts' Top S&P 500 Stocks to Buy Now
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
ESPN to Acquire NFL Network and RedZone in Exchange for 10% Equity Stake
ESPN will take control of NFL Network and RedZone, while the NFL secures a 10% stake in ESPN — a move that could change how fans watch football.
-
Stocks Rally on Apple Strength: Stock Market Today
The iPhone maker will boost its U.S. investment by $100 billion, which sent the Dow Jones stock soaring.
-
Stocks Rally on Apple Strength: Stock Market Today
The iPhone maker will boost its U.S. investment by $100 billion, which sent the Dow Jones stock soaring.
-
What to Know About Multisector ETFs
Multisector bond funds allow investors to pick and choose among a wide array of assets.
-
I'm an Estate Planning Attorney: These Are the Two Legal Documents Everyone Should Have
Every adult should have a health care proxy and power of attorney — they save loved ones time, money and stress if a sudden illness or injury leaves you incapacitated.
-
I'm a Financial Professional: Here's My Investing Playbook for Political Uncertainty
For successful long-term investing in a politically charged environment, investors should focus on economic data, have a diversified portfolio and resist reacting to daily headlines.
-
Rally Pauses for Hot Earnings, Cool Data: Stock Market Today
Markets were mostly mixed Tuesday after decisive moves Friday and Monday.
-
The Truth About the Dark Side of Rooftop Solar Panels
Rampant bankruptcies in the solar panel industry have left many consumers with systems that don't work and no way to get them fixed. Worse, they're being hounded to keep paying despite not receiving what they were promised. What can they do?
-
Six Big Beautiful Opportunities: Advisers' Guide to Tax and Client Strategies
Here are several ways financial professionals can help their clients maximize opportunities in the One Big Beautiful Bill Act, which extends key TCJA provisions, introduces increased deductions for people 65 and older and more.
-
Dow Rises 585 Points on Rate Cut Hope: Stock Market Today
Stocks moved more than 1% again Monday, this time to the upside following the Jobs Friday sell-off.