Microsoft seen weathering foreign exchange, PC market issues
lcva2/iStock Editorial via Getty Images

With Microsoft (NASDAQ:MSFT) cutting its fourth-quarter earnings and revenue outlook last week, speculation has grown over whether new dings could emerge in the $2T-market cap company's armor.
Microsoft (MSFT) took down its earnings and revenue forecast on the grounds that its business is being hampered to a degree by foreign currency exchange issues. The company said it expects foreign exchange issues to have an impact of $460M impact on its business, and now estimates it will earn between $2.24 a share and $2.32 a share, on revenue in a range of $51.94B to $52.74B for its fiscal fourth quarter. Microsoft (MSFT) had earlier predicted it would earn $2.28 a share to $2.35 a share on revenue between $52.4B and $53.2B.
That revised forecast, along with some weaker data from the PC market, led Morgan Stanley analyst Keith Weiss to trim his earnings estimates on Microsoft (MSFT). On Tuesday, Weiss said he now believes that Microsoft (MSFT) will earn $10.84 a share for its 2023 fiscal year, down from an earlier forecast of $10.93 a share.
Weiss said Microsoft's (MSFT) announcement last week "surprised investors" because the U.S. dollar had been relatively unchanged compared to other major world currencies such as the euro and British pound. However, Weiss said Microsoft's (MSFT) original forecasts "did not incorporate the steep appreciation of the U.S. dollar" in the two weeks that led up to the company's April 26 earnings report.
Weiss added that PC shipments are showing signs of "headwinds" in the market, and Microsoft (MSFT) itself said that if COVID-related production shutdowns in China continued, it would see some effect on its Windows business.
"While the supply chain headwinds are easing," Weiss said, "They continue to pressure the overall PC market." 
Weiss maintained his overweight rating and $372-a-share price target on Microsoft's (MSFT) stock.
In addition to cutting its earnings and sales outlook, Microsoft (MSFT) has gathered attention of late due to reports that it had put the brakes on hiring new employees for its Windows and Office Teams divisions.