STORY: Shares of Microsoft fell on Thursday, after the tech giant cut its profit and revenue outlooks for the current quarter, making it the latest American company to warn of a hit from a stronger U.S. dollar.
The Federal Reserve's fight against inflation and heightened geopolitical tensions have driven a 14% gain in the dollar against a basket of currencies over the last year, forcing other companies such as Coca-Cola and Procter & Gamble to temper expectations for the rest of the year.
A stronger dollar typically eats into the profits of companies with operations all over the world that convert foreign currency into American money and has added to corporate worries over soaring inflation.
Microsoft gets about half its revenue from outside the United States, so the company lowered its revenue forecast for Windows products, as well as cloud and personal computing - which one analyst called a "prudent" move.
Microsoft said it now expects to report as much as $52.7 billion in revenue for the quarter, after previously forecasting as much as $53.2 billion.