Microsoft Corporation (NASDAQ:MSFT) Shares Gap Down On Earnings Miss, Profit Down 22%

Microsoft Corporation(NASDAQ:MSFT) late Thursday reported a 22 percent drop in earnings for the September quarter as sales of personal computers showed a downward trend.

The world's largest software maker reported net income at $4.47 billion, or 53 cents a share, compared to $5.74 billion, or 68 cents a share, for the year-earlier period.

Revenue was $16 billion, down 8 percent from $17.37 billion a year before.

Analysts had expected the company to report 56 cents a share as earnings on revenues of $16.42 billion.

Should Investors Buy MSFT After The Earnings? Find Out Here

While some kind of a slowdown was expected from Microsoft, figures released by the company disappointed investors and analysts. Shares in the company fell more than 1 percent after the news and then pulled back a bit to close down 0.32 percent at $29.50 a share.

The Redmond-based company is set to launch its Windows 8 software on October 26 and it really has to succeed in this.

However the situation is grim for personal computers as consumers are being lured away by mobile devices that are handier to carry around, are cheaper and are becoming more powerful.

Recently research firm IDC said that PC shipments declined 8.6 percent globally in the last quarter, much worse than it had expected.

Intel, the primary maker of chips that power PCs, said this week that its sales and profit fell because of weakness in the market.

Microsoft is hoping that the new operating software with more advanced features than its predecessors would bring back customers to the traditional computing market.

The company has also realised the trend towards mobile devices and in a recent message to shareholders, CEO Steve Ballmer gave enough indication that the company would no be paying more attention to the mobile devices market.

Shares of MSFT are down 2.31% to $28.82 in early hour.