$MSFT DD - A Glimpse Into the Future - Buy Calls

We would all agree that Microsoft is a blue chip beast, and will likely perform well during earnings on Wednesday, 1/29. However, Intel's and IBM's earnings report gave us a glimpse into the future to confirm how well Microsoft will perform.

We know that Microsoft is developing several new data centers, as their cloud computing platform continues to grow faster than AWS. Intel confirms these growths are larger than expected.

Revenue from the company’s Data Center Group, which makes chips for computer servers, was up about 19% at $7.21 billion, more than the $6.40 billion FactSet analyst consensus.

IBM also confirmed a large growth in cloud computing.

IBM CFO: Q4 results driven by acceleration of hybrid cloud portfolio.

This was the best single day gain IBM has seen in a decade.

There is a huge surge in new Windows purchases as well.

In the first half of the year Intel will be able to sell chips as people upgrade to Microsoft’s Windows 10 operating system — Microsoft’s support for Windows 7 ended earlier this month — and that factor will taper off in the second half, Swan said.

In addition to this, Microsoft Teams is growing faster than Slack, and their Office 365 special edition ran out of stock (limited subscription).

I expect most of their growth to be based on cloud computing, they their software sales should be excellent too.

Because this is a heavy blue chip, I sold a few stacks of put credit spreads, but I think ITM/ATM calls would be profitable as well.