Microsoft shares sank about 5 percent after the company reported that quarterly earnings dropped 25 percent. The Redmond-based software giant is trying to move beyond its traditional dependence on the personal computer market, which is struggling.
Microsoft’s revenue dropped 6 percent to $20.5 billion in the quarter that ended in March, and the company reported earnings excluding some expenses of 62 cents per share, falling short of the 64 cents that analysts on average expected, according to estimates compiled by Factset.
One problem is a slumping PC market. IDC analyst Al Hilwa said personal computing no longer revolves around Windows as more and more people use smart phones and tablets.
"Everybody’s got Apple devices and Android devices side by side with PCs and what we’re seeing now is the company shift strategy to adjust to that," Hilwa said.
That shift includes making Word, Excel and other programs available on competitors’ operating systems. Microsoft’s also trying to compete more with Amazon in cloud computing.