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What: Shares of Microsoft (NASDAQ:MSFT) got totally crushed today, down by 12% at the low, after the software giant reported disappointing earnings last night.

So what: Revenue in the quarter came in at $19.9 billion, which translated into earnings per share of $0.59. Both figures were shy of Street forecasts, but perhaps more troubling to investors was a large inventory charge related to Microsoft's Surface RT tablets.

Now what: Microsoft is taking a $900 million charge over its first foray into tablet hardware, which adversely affected the bottom line by $0.07. CFO Amy Hood confirmed that the write-down was partially related to the $150 price cut that was implemented this month. Meanwhile, the struggling PC market continues to take its toll on Microsoft's core businesses as its transition to a devices-and-services company remains uncertain.

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Fool contributor Evan Niu, CFA has no position in any stocks mentioned. The Motley Fool owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.