Credit Suisse expects Microsoft revenue to decline

Credit Suisse on Wednesday revised downward its forecasts for Microsoft, stressing that overstocking and economic instability are causing "the steepest decline in the PC market in two decades."

Microsoft executives are forecasting a decline in Windows OEM revenue in the single digits in September. According to consensus estimates, the decline in Windows OEM revenue is now projected at 8.0% year-over-year.

According to analysts, the projections for the September quarter mark the steepest market decline since Gartner began tracking the PC market and the fourth consecutive year-over-year decline.

The analysts stressed that while supply issues and supply chain disruptions have abated, the PC market now faces rising inventory levels coupled with falling demand in both the consumer and enterprise segments.

Analysts also confirmed that due to a significant decline in PC supply dynamics, deteriorating macroeconomic conditions and increased negative currency-related factors, the revenue/earnings per share forecast for fiscal 2023/2024 was revised to $216.8/252.1 billion and $9.78/12.27 from $221.1/257.2 billion and $10.05/12.49 respectively.