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Speaker 1: Well, Microsoft, let's pivot back to the big tech stories today.

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Speaker 1: It gave an upbeat sales forecast for the fiscal year

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Speaker 1: that just began easing investor concerns after lackluster fourth quarter results.

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Speaker 1: Joining us now to discuss this further is Anaragrana Bloomberg

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Speaker 1: Intelligence senior software in I T Services analysts. So, um,

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Speaker 1: you know, the results, it was a mixed picture. I mean,

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Speaker 1: the current are the past results were bad, the strong

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Speaker 1: dollar hurting some international repatriation profits, but the outlook was good.

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Speaker 1: Double digit sales growth for fiscal year three is being

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Speaker 1: forecast by ms F T that it doesn't sound like

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Speaker 1: Microsoft is a company bracing for a bad recession. Yeah,

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Speaker 1: I would agree with that. Now, the thing that I

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Speaker 1: would mention is that, you know, in our view what

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Speaker 1: happens with the results due to the dollar is a

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Speaker 1: material to the economics of the business or the underlying

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Speaker 1: you know way the products are being sold only because

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Speaker 1: it's a translation concept. It's not so much you know,

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Speaker 1: how the how the clients in Europe and the client

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Speaker 1: teen Asia are buying their products. So from our point,

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Speaker 1: you know, we really don't look at growth in U

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Speaker 1: S dollars, But in constant currency. Now, as far as

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Speaker 1: the guidance is concerned, you know, simply spectacular that beginning

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Speaker 1: of this year they can come out and say that

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Speaker 1: they're going to grow double didgets. And frankly speaking, whatever

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Speaker 1: revenue is lost this year because of macroeconomic weakness, we

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Speaker 1: think it gets bounced back next year, and next year

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Speaker 1: could be even better. So from that point of view,

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Speaker 1: I think Microsoft is is doing really well, far better

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Speaker 1: than what I had anticipated going in. It's so interesting,

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Speaker 1: such a far cry from the Microsoft of six or

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Speaker 1: seven years ago. A lot of people credit the cloud.

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Speaker 1: The growth is still strong, but it's not bulletproof. I

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Speaker 1: mean it is, you know, frankly speaking, if you think

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Speaker 1: about it, the size that business is so large, and

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Speaker 1: given that they're still going to grow above forty you know,

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Speaker 1: in my view, that's very impressive, especially when the entire

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Speaker 1: cloud market is only growing, you know, somewhere in the

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Speaker 1: thirty percent range. So from my side, I mean I

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Speaker 1: cannot find mistakes in these numbers, only because if you

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Speaker 1: think about it, the world is a very different place

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Speaker 1: six seven months compared to what it was six seven

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Speaker 1: months ago. And in this environment, a company like Microsoft,

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Speaker 1: which is you know, roughly let's say one third or

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Speaker 1: one fourth of the entire software market can grow faster

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Speaker 1: than the software market. I mean I really can't find

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Speaker 1: mistakes in that mean, is this a good harbinger for

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Speaker 1: what the other tech companies that are likely to be

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Speaker 1: reporting or is it in a bit of isolation, I

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Speaker 1: would say this is a bit of a different company

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Speaker 1: only because it's very much enterprise focus is focused on

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Speaker 1: larger companies. You know, let's say a company like Amazon,

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Speaker 1: their cloud business based on this should do very well.

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Speaker 1: There's no reason that's not going to have That's that's

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Speaker 1: what you should should, you know, continue with the same front. Now,

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Speaker 1: their retail business is going to have a problems, as

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Speaker 1: we saw with Walbart yesterday, so we're going to see

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Speaker 1: how that shapes up. And as far as Apple is concerned,

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Speaker 1: you know, it is also over expposed to the dollar

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Speaker 1: strength as well as weakness in China because of COVID.

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Speaker 1: So Apple has its own problems that it has to

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Speaker 1: deal with. But once again, you know, in my view,

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Speaker 1: you want to look at these companies not so much

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Speaker 1: in what happens on a quarter to quarter basis, but

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Speaker 1: you know, is is this a better business model compared

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Speaker 1: to a few years ago, and I would argue all

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Speaker 1: the top companies are far stronger today than they were

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Speaker 1: two years ago. Yeah. I caught myself earlier misreporting that

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Speaker 1: Microsoft talked about double digit profit growth next year. They

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Speaker 1: talked about double digit sales growth. Um, so I want

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Speaker 1: to ask you about profit, particularly in light of the

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Speaker 1: the CFO saying that they were hiring eleven thousand new

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Speaker 1: people in the first quarter. That sounds pretty encouraging from

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Speaker 1: the economic side. But will that raise the cost structure

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Speaker 1: a lot? No matter it is, But frankly speaking, software

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Speaker 1: is a product that is I would say less prone

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Speaker 1: to you know, pricing pressure when you have a product

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Speaker 1: that has gross margin and you pretty much pay whatever

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Speaker 1: the client is asking for or what are the companies

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Speaker 1: asking for, you know, from their from their hiding uh side,

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Speaker 1: I think it's going to be more on the R

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Speaker 1: and D side and not so much on the sales

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Speaker 1: and marketing side, because you know, company like Microsoft does

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Speaker 1: not need that many sales people to sell its product.

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Speaker 1: So from my side, I mean, I'm not I'm not

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Speaker 1: too concerned about the margins. Frankly, I think if anything,

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Speaker 1: it's going to be maybe a one personage point drop

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Speaker 1: but not more than that. Yeah, okay, well out of

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Speaker 1: time now on Rock. But a real pleasure to have

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Speaker 1: you on the program. Thank you very much for being

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Speaker 1: with us on Grana. Bloomberg Intelligence senior Software and I

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Speaker 1: T Services analysts