Microsoft said Wednesday it will miss quarterly revenue guidance for its “More Personal Computing” business segment due to the coronavirus outbreak.
“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 at the time of our Q2 earnings call,” 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. All other components of our Q3 guidance remain unchanged.”
As part of its December quarter earnings report, Microsoft expected to report $10.75 to $11.15 billion in revenue for the More Personal Computing segment, which includes Windows, Xbox, Surface and related businesses. The company had already issued a wider range “to reflect uncertainty related to the public health situation in China.”
Shares were down 2 percent in after-hours trading.
The More Personal Computing division rose in the holiday quarter to $13.2 billion in revenue, up from just under $13 billion a year ago, reclaiming the title of the company’s largest division. Microsoft reported total quarterly revenue of $36.9 billion.
Apple said last week that it will miss quarterly revenue forecasts due to the outbreak, which has infected around 80,000 people and killed more than 2,700. Various other companies such as Expedia and Nintendo have also reported disruptions.
“As the conditions evolve, Microsoft will act to ensure the health and safety of our employees, customers, and partners during this difficult period,” Microsoft said. “We will also continue to partner with local and global health authorities to provide additional assistance. We deeply appreciate the commitment of the people and organizations that have united to address this health emergency; our thoughts are with all those affected across the world.”