Microsoft Warns Of Coronavirus Impact

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Redmond does not expect to meet its guidance for sales of Windows and Surface devices due to the coronavirus outbreak

Microsoft is the latest tech firm to warn about the impact of the Coronavirus outbreak will have on its financial performance during the quarter.

The outbreak has already seen the cancellation of the Mobile World Congress 2020 show. As on Thursday this week, the death toll from the coronavirus has reached 2,800 people worldwide, the vast majority in mainland China. There are also 72,436 infections globally.

Last week Apple, which already closed all 42 stores in China, warned it may not be able to meet its March-quarter sales forecast, and also said there could be iPhone supply shortages in the months ahead.

Microsoft warning

And now Microsoft has become the latest tech firm to warn of the impact of the outbreak, when it said on Wednesday that it does not expect to meet its quarterly revenue forecast for its Windows and personal computing business.

The news sent Microsoft shares down more than 1 percent in after-market trading.

The company said the remaining elements of its fiscal third-quarter outlook were unchanged.

“Although we see strong Windows demand in line with our expectations, the supply chain is returning to normal operations at a slower pace than anticipated,” the company said in a statement.

“As a result, for the third quarter of fiscal year 2020, we do not expect to meet our More Personal Computing segment guidance as Windows OEM and Surface are more negatively impacted than previously anticipated,” said Microsoft. “All other components of our Q3 guidance remain unchanged.”

The software maker had previously expected the More Personal Computing unit, which houses Windows, to post third-quarter revenue between $10.75 billion and $11.15 billion.

Its Windows and Surface computers had been more negatively impacted than expected, Microsoft said in a statement.

“As the conditions evolve, Microsoft will act to ensure the health and safety of our employees, customers, and partners during this difficult period,” said Redmond. “We will also continue to partner with local and global health authorities to provide additional assistance.”

Microsoft signed off by stating how much it appreciated all the work that international health organisations are undertaking in relation to the outbreak.

“We deeply appreciate the commitment of the people and organisations that have united to address this health emergency; our thoughts are with all those affected across the world,” Microsoft said.

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Author: Tom Jowitt
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