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Microsoft earnings disappoint; shares drop 5%

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Microsoft reported fourth-quarter earnings and revenue Thursday that fell short of analyst expectations.

The software behemoth's shares dropped more than 5 percent after the closing bell on the news.

Earnings excluding items dipped to 66 cents per share from 67 cents a share in the year-earlier period.

Revenue improved to $19.9 billion from $18.06 billion a year ago.

Analysts had expected the company to report earnings excluding items of 75 cents a share on $20.73 billion in revenue, according to a consensus estimate from Thomson Reuters.

What is Microsoft's stock doing now? (Click here for the latest after-hours quote.)

The world's largest software maker is having to adjust to the industrywide decline in PC sales and faces questions about the restructuring effort it announced last week, dubbed "One Microsoft." Investors are eager also to hear about Surface tablet sales and the upcoming Xbox One launch.

(Read More: Microsoft CEO Unveils 'One Microsoft' in Broad Shake-Up)

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