After the closing bell on Wednesday, the world's largest software maker Microsoft (MSFT - Free Report) delighted investors with better-than-expected fiscal fourth-quarter 2020 results. It continued a long track of beating earnings estimate and topped the revenue estimate. Microsoft has benefited from the work-from-home and learn-at-home trends during the COVID-19 pandemic.

Earnings per share came in at $1.46, outpacing the Zacks Consensus Estimate by 8 cents and improving 7% from the year-ago quarter. Investors should note that Microsoft has not missed on quarterly earnings since third-quarter fiscal 2016. Revenues rose 13% year over year to $38 billion, topping the consensus estimate of $36.59 billion.

Despite gaining from the stay-at-home order, growth of the flagship Azure computing platform slowed to 47% last quarter from 59% in fiscal third quarter, leading to investors’ disappointment. Sales of Office 365 Commercial and Dynamic 365 climbed 19% and 38%, respectively.

Microsoft expects revenues of $35.61 billion for fiscal first quarter, representing 8% year over year growth. The Zacks Consensus Estimate is pegged at $35.90 for revenues.

Following the earnings announcement, shares of Microsoft fell as much as 3% in after-market hours on slowing Azure sales. Currently, Microsoft carries a Zacks Rank #3 (Hold) and has a Growth Score of B. It falls under a top-ranked Zacks industry (top 43%), which suggests its outperformance in the days ahead.

ETFs in Focus

Investors seeking to invest in this software leader could tap the beaten-down price through ETFs with a lower level of risk. While there are several ETF options available, we have highlighted six with double-digit exposure to Microsoft that could be compelling choices.

Select Sector SPDR Technology ETF (XLK - Free Report)

This most-popular technology ETF follows the Technology Select Sector Index and has $32.8 billion in AUM. The fund charges 13 bps in fees per year from investors and trades in heavy volume of around 16.8 million shares a day on average. It holds about 71 securities in its basket, with Microsoft occupying the top position at 21.7%. XLK has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.

iShares U.S. Technology ETF (IYW - Free Report)

This ETF tracks the Dow Jones U.S. Technology Capped Index, giving investors exposure to 161 technology stocks. Of these, Microsoft occupies the top position in the basket with 18.9% of the assets. The fund has AUM of $5.9 billion and charges 42 bps in fees and expenses. Volume is good as it exchanges nearly 196,000 shares a day. The fund has a Zacks ETF Rank #1 with a Medium risk outlook.

Vanguard Information Technology ETF (VGT - Free Report)

This fund manages about $33.9 billion in its asset base and provides exposure to 330 technology stocks. It currently tracks the MSCI US Investable Market Information Technology 25/50 Index. Here MSFT occupies the second position with 18% share. The ETF has 0.10% in expense ratio, while volume is solid at nearly 1.1 million shares. It has a Zacks ETF Rank #1 with a Medium risk outlook.

MSCI Information Technology Index ETF (FTEC - Free Report)

This fund is home to 314 technology stocks with AUM of $4.2 billion. It follows the MSCI USA IMI Information Technology Index. MSFT is the second firm with 17.7% allocation. The ETF has 0.08% in expense ratio, while volume is solid at 636,000 shares a day. It carries a Zacks ETF Rank #1 with a Medium risk outlook.

iShares Evolved U.S. Technology ETF (IETC - Free Report)

This is an active ETF, having accumulated $78.5 million in its asset base. It employs data science techniques to provide exposure to 227 technology stocks. Microsoft is the top firm with 16.9% allocation. IETC trades in a light volume of 38,000 shares and charges 18 bps in annual fees.

iShares Global Tech ETF (IXN - Free Report)

This product provides exposure to electronics, computer software and hardware, and informational technology companies by tracking the S&P Global 1200 Information Technology Sector Index. Holding 119 stocks in its basket, Microsoft occupies the top spot with 17.2% share. The ETF has amassed $4 billion in its asset base and trades in a good volume of 119,000 shares a day on average. Expense ratio came in at 0.46%.