Microsoft's 'durability' to be on display with its third-quarter results
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Microsoft (NASDAQ:MSFT) is set to report fiscal third-quarter earnings Tuesday after the close and though tech stocks have been hit hard in recent days, investment firm Piper Sandler believes the company's model should help it weather any short-term disruptions.
Analyst Brent Bracelin, who rates Microsoft (MSFT) overweight with a $352-a-share price target, noted that cloud-related revenue has climbed to 48% of the company's sales, up from 42% a year ago and 36% in 2020. Given that few cloud franchises are this large, Bracelin said such gains could boost Microsoft (MSFT) despite business and international worries from around the globe. 
"The cloud model transformation at [Microsoft] should help insulate growth during the March quarter, despite rising global risks," Bracelin wrote in a note to clients. Bracelin added that the cloud will still help Microsoft (MSFT) "sustain double-digit overall growth in revenue."
A consensus of Wall Street analysts estimates Microsoft (MSFT) will earn $2.20 a share on $49.05 billion in revenue during the period.
In addition, Bracelin noted that Office 365 is likely to see a "positive bias," during the quarter, given that companies are still hiring at a healthy clip and anything they can do to boost productivity, collaboration, and security should benefit. 
The analyst also pointed to a "noteworthy increase" in Office 365 mobile downloads, largely coming from Brazil, India and Indonesia, as well as the price hike that went into effect on March 1 and March 15 for resellers that could drive Office-related revenue.
It's likely that there will be "few surprises" from Azure during the quarter, as Bracelin pointed out that Microsoft's (MSFT) management said last quarter the segment would improve this quarter.
There could be a negative bias concerning foreign exchange headwinds and commercial bookings, as bookings have moderated for two straight quarters after rising 35% over the past two years.
And given that roughly 50% of Microsoft's (MSFT) sales come from international, it could face a similar headwind on FX that IBM (IBM) pointed out last week.
On Monday, Wedbush Securities said the results from Microsoft (MSFT) and Apple (AAPL) "could dictate the path of tech stocks over the coming months."