After Microsoft (MSFT) reported fiscal Q2 earnings and CEO Satya Nadella highlighted how "organizations are exercising caution given the macroeconomic uncertainty," BofA analyst Justin Post noted that Azure’s constant currency growth decelerated 4 points to 38% year-over-year. CFO Amy Hood noted Azure exited Q2 at mid-30% year-over-year constant currency growth and that Q3 growth is expected to further decelerate 4-5 points from the mid-30% range, which implies 30-31% growth, noted the analyst. Microsoft and Amazon (AMZN) shares were up 4% and 3.5%, respectively, in after-hours trading prior to the guidance commentary, but both erased those gains following guidance, the firm points out. Given Microsoft’s commentary on Azure, AWS will remain a concern into Amazon’s earnings report, said BofA, which expects a deceleration in Q1 to 20% year-over-year growth for AWS. BofA maintains a Buy rating and $135 price target on Amazon shares.
Published first on TheFly
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