Microsoft's revenue growth accelerated to 17.7% in 2026Q4, driven by cloud and AI monetization, while operating margin expanded to 45.1% from 43.1% a year earlier. However, the aggressive AI infrastructure buildout has driven capex to 39.8% of revenue, compres...
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Revenue growth accelerated to 17.7% in 2026Q4 with operating margin expanding to 45.1%, though gross margin declined to 67.2% from 70.1% in 2024Q3 due to AI mix dilution.
Azure is expected to grow over 35% through fiscal year 2026 as supply constraints ease.
Increased adoption of Microsoft 365 Copilot among enterprise clients is anticipated to significantly boost revenue.
Significant capital expenditures on AI infrastructure are necessary to maintain competitiveness, with new capacity expected in late 2026.
Planned AI infrastructure spending could reach up to $190 billion in 2026, risking free cash flow margins.
There are concerns about softening AI demand and execution risks with Microsoft 365 Copilot adoption.
Increased depreciation from AI infrastructure investments may lead to margin compression.
Trailing total returns as of 10/12/2026, which may include dividends or other distributions. Benchmark is S&P 500 (^GSPC).
Check whether operating performance supports the current valuation.
Recent results and news deserve attention only when they alter the forward view.
| Quarter | EPS (Act vs Est) | Revenue (Act vs Est) |
|---|---|---|
Q3 2026Latest Jul 29, 2026 | $4.74+11.8% vs $4.24 | $90.0B+2.7% vs $87.6B |
Q2 2026 Apr 29, 2026 | $4.27+5.2% vs $4.06 | $82.9B+1.8% vs $81.4B |
Q1 2026 Jan 28, 2026 | $4.14+6.2% vs $3.90 | $81.3B+1.2% vs $80.3B |
Q4 2025 Oct 29, 2025 | $4.13+12.5% vs $3.67 | $77.7B+2.9% vs $75.5B |
We recorded this week's GeekWire Podcast at Front Burner Studios near Pike Place Market with co-owner Seth Paul, CEO of security startup Qinsay.
Microsoft (MSFT +2.38%) is starting to show measurable returns from its enormous AI build-out, with Azure demand remaining strong and Copilot adoption expanding. The next test is harder: whether rising utilization and improving efficiency can overcome massive capital spending, margin pressure, and weaker free cash flow to create a durable earnings engine.
The Trump administration suspended Microsoft, Adobe and six IT services firms from PERM, the Labor Department program that lets employers sponsor foreign workers for green cards. Vice President JD Vance accused Microsoft of replacing laid-off American workers with foreign hires.
Microsoft does not appear to have gained as much growth from its AI spending as some key peers have. The lack of specific data about Azure's growth prior to the latest quarter may have obscured some of the benefits of Microsoft's AI spending for investors.
Benchmark MSFT against direct peers instead of judging its metrics in isolation.
Key metrics vs top competitors for Microsoft Corporation (MSFT)
| Company | Price | Market Cap | P/E Ratio | Rev Growth (1Y) | Net Margin | ROE | Div Yield |
|---|---|---|---|---|---|---|---|
| $535.07 | $3.97T | 29.81 | 17.79% | 40.31% | 34.04% | 0.66% | |
| $336.64 | $4.94T | 45.13 | 6.43% | 27.62% | 137.18% | — | |
| $351.66 | $4.26T | 32.53 | 15.13% | 54.77% | 50.84% | — | |
| $262.43 | $2.82T | 36.60 | 12.38% | 17.44% | 30.5% | — | |
| $718.67 | $1.83T | 30.59 | 22.17% | 29.84% | 29.73% | — | |
| $141.53 | $407.05B | 24.28 | 17.35% | 26.36% | 42.1% | — |
Microsoft Corporation (MSFT) vs competitors — business, growth, and fundamentals comparison against the closest industry rivals.
Verify the primary filings, follow material updates, and answer the remaining questions.
Microsoft Corporation (MSFT) SEC filings — annual & quarterly reports (10-K, 10-Q)
Jul 29, 2026·SEC
Jun 5, 2026·SEC
May 14, 2026·SEC
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Microsoft Corporation (MSFT) stock FAQ — growth, dividends, profitability & financials explained
Microsoft Corporation (MSFT) reported $331.84B in revenue for fiscal year 2026. This represents a 2680% increase from $11.94B in 1997.
Microsoft Corporation (MSFT) grew revenue by 17.8% over the past year. This is strong growth.
Yes, Microsoft Corporation (MSFT) is profitable, generating $133.75B in net income for fiscal year 2026 (40.3% net margin).
Yes, Microsoft Corporation (MSFT) pays a dividend with a yield of 0.66%. This makes it attractive for income-focused investors.
Microsoft Corporation (MSFT) has a return on equity (ROE) of 34.0%. This is excellent, indicating efficient use of shareholder capital.
Microsoft Corporation (MSFT) generated $66.99B in free cash flow for fiscal year 2026. Positive FCF indicates the company can fund dividends, buybacks, or reinvestment.
