Microsoft Poised to Emerge From the COVID-19 Pandemic Stronger

Like many other companies have done in the past several weeks, Microsoft (NASDAQ: MSFT) last month issued an earnings warning related to the potential adverse effects of the coronavirus pandemic. But unlike some of them, the tech giant is poised to emerge in a stronger position once the economic downturn has run its course.

That wasn't the case for Microsoft after the Great Recession of 2008-09 when it struggled for several years to fully recover. But this is also a much different company. At least that's the message Microsoft CEO Satya Nadella is sending to investors. In a recent interview, Nadella expressed confidence that Microsoft will come out of the pandemic "pretty strong." The CEO pointed to the software giant's "great balance sheet" and what he called a diverse business that consists of a bigger mix of annuity and non-annuity revenue than it had when the financial crisis hit 12 years ago. "We will weather the storm," the executive said.

It's a sentiment shared by investors. Despite the steep sell-off in the broader market during March, Microsoft has been resilient. Shares tanked 13% from mid-February to mid-March, but have been able to recover some of the losses since then. Year to date Microsoft shares are only off 4%. The company still boasts a market capitalization of more than $1 trillion. It's also been making moves during the pandemic to position itself for the strength Nadella has been talking about.

Source Fool.com