Trump Retweets Call for Microsoft Federal Contract Ban

President Trump retweeted a former aide's post saying Microsoft should pay for its conditional refusal to sell facial recognition to the police.
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President Trump launched a negative hint in Microsoft’s  (MSFT) - Get Report direction Friday.

He retweeted a Twitter post from a former aide saying that the software titan should be excluded from federal government contracts for its conditional refusal to sell facial recognition to police departments.

“They should now be barred from federal government contracts. There should be consequences for not selling technology to police departments,” Richard Grenell, Trump’s former acting director of national intelligence wrote in his tweet.

Microsoft President Brad Smith said Thursday that the company won’t sell facial recognition software to police departments until the government establishes rules controlling the use of that technology.

On Wednesday, Amazon.com  (AMZN) - Get Report announced a one-year moratorium on letting police use its facial recognition software. And earlier this week, IBM said it would no longer sell or develop facial recognition technology.

All this comes amid the nation’s civil rights protests, sparked by the police killing of George Floyd. Studies have shown that existing facial recognition technology is not as good at identifying people of color. 

As for Microsoft, Morningstar analyst Dan Romanoff sees good times ahead.

“We remain impressed with Microsoft's ability to drive revenue and margins at this scale, and we continue to believe there is more to come on both the revenue and margin fronts,” he wrote in a commentary April 30.

“Results continue to underscore our thesis, which centers on customer adoption of hybrid cloud environments with Azure. Microsoft continues to use its dominant position of on-premises architecture to allow customers to move to the cloud easily and at their own pace, which we believe will continue over the next five years.”

Microsoft shares recently traded at $190.19, up 2.10%. The stock has gained 24% in the last three months, compared to 12% for the S&P 500.

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