microsoft on Thursday cut its earnings and revenue forecasts for the fourth quarter, citing the impact of the strong dollar, which sent shares of the tech giant down 3 percent.
The dollar has risen about 14% against a basket of currencies in the past year, fueled by a Federal Reserve hardliners and rising geopolitical tensions.
A stronger greenback has pressured the profits of US multinational companies that convert foreign currency into dollars, adding to business concerns about accelerating inflation and prompting some to more actively seek ways to cover your profits.
Microsoft, which gets most of its revenue from cloud services, expects quarterly revenue to be $51.94 billion and $52.74 billion, down from the previous range of $52.4 billion to $53.2 billion.
The firm cut its earnings forecast to between $2.24 and $2.32 a share, from a previous expectation of between $2.28 and $2.35 a share. Analysts forecast a profit of $2.33 per share on revenue of $52.87 billion, according to Refinitiv data.
In April, Microsoft had forecast double-digit revenue growth for the next fiscal year, driven by demand for cloud computing services.
Salesforce, Coke, Procter & Gamble Y Phillip Morris are other companies that have warned of an impact on their profits due to the strength of the dollar.