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Shares of Microsoft (MSFT) were down 4.35% as of the close today in spite of the company’s strong beat of Wall Street projections for the company’s fiscal fourth quarter that ended on June 30.

The company reported earnings of $1.46 a share, versus Wall Street projections of $1.38 a share, and saw revenue of $38 billion for the June period, versus the consensus expectation of $36.6 billion in sales.

Year over year Microsoft earnings grew by 7% and sales climbed by 13%. That was the slowest earnings growth in eight quarters and comes at a pivotal moment for Microsoft shares. The stock was up 34.92% for 2020 to date as of July 22 close and up 22.33% for the last three months. That has driven the forward price to earnings ratio on projected earnings to 33.67.

This isn’t a good time for the company to raise doubts about its future growth rate.

Which, however, is exactly what Microsoft did in yesterday’s earnings. Which is why the stock is down so strongly today.

As in recent quarters Microsoft’s Intelligent Cloud software segment drove revenue growth with 17% growth in the quarter. Inside the unit server software and Azure cloud services pushed growth.

But it pushed growth at a far lower pace. Azure sequential growth and new bookings grew at half the rate of the June quarter in 2019. Analysts estimate that total cloud revenue growth slowed to 22% from 32% in the year earlier period.

Microsoft also fed into Wall Street fears with its decision not to issue guidance for the entire fiscal 2021 year ahead. For the current quarter, the company said that it expects revenue growth of about 8% o $35.6 billion in the September quarter (using the midpoint of the company’s guidance.) Before yesterday’s report, Wall Street had been looking for sales of $35.9 billion in the September quarter.

Microsoft is a member of my Jubak Picks Portfolio. The stock is up 100.17% since I added it to the portfolio on June 14, 2018.