Microsoft Corporation (MSFT)
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Business model, numbers and balance sheet hold up to our review. Whether the current price supports an entry is a separate question — it hangs on the price, not on the company.
The quality of the business is documented: a highly profitable core, $414.4 billion of equity, $78.3 billion of liquidity, no existential dependency on a single counterparty, no accounting or governance breach, and unusually candid reporting — Microsoft voluntarily strips its own OpenAI book gain out of the result. A buyer today is nonetheless betting that the $80.1 billion spent over the last nine months comes back as cash later; until it does, profit grows faster than the money actually left over. The decision is yours.
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Microsoft earned $98.0 billion in the nine months ended March 31, 2026, up 31 percent from a year earlier. Free cash flow — the money left after every investment — went from $46.0 billion to $47.3 billion, a rise of 2.8 percent. In between sit $80.1 billion of datacenter spending, a $4.5 billion book gain from the dilution of the OpenAI stake, and $62.9 billion of finance lease liabilities that now exceed every bond the company has issued. We read the filings line by line — and follow the profit to see where it goes before it reaches a shareholder.
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Stock Watch
This analysis is as of July 28, 2026. Stock Watch will tell you what's changed at MSFT since then.
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Trading Day
Key levels of the most recently completed trading day — not a live quote.
52-Week Range
Current price 464.70 $ — 59% of the range above the low.
Lowest and highest closing price over the last 52 weeks. The marker shows where the current price sits within that range: close to the high speaks for strength, close to the low for weakness.
Basics
Performance
Technical Indicators
Calculated from the price history · as of 08/03/2026
Valuation
Profitability
Balance Sheet & Safety
Growth
Dividend
Quality & Screener
AI Rating
Sells AIMicrosoft verkauft KI unmittelbar als Umsatzquelle: Azure-KI-Dienste, Microsoft 365 Copilot und Azure AI Foundry sind im Geschäftsbericht als eigene Produktlinien beschrieben, und der Quartalsbericht führt den Rückgang der Cloud-Bruttomarge ausdrücklich auf die wachsende Nutzung von KI-Produkten zurück.
View the full file — quotes, sources, reviewed filings
„Azure AI offerings provide a competitive advantage as companies seek ways to optimize and scale their business with AI. We offer supercomputing power for AI at scale to run large workloads, complemented by our rapidly expanding portfolio of AI cloud services (including the latest models) and hardware, which includes custom-built silicon and strong partnerships with chip manufacturers."
Azure-KI-Angebote verschaffen uns einen Wettbewerbsvorteil, weil Unternehmen nach Wegen suchen, ihr Geschäft mit KI zu optimieren und zu skalieren. Wir bieten Supercomputing-Leistung fuer KI im großen Maßstab, ergänzt um unser rasch wachsendes Portfolio an KI-Cloud-Diensten (einschließlich der neuesten Modelle) und Hardware, zu der maßgeschneiderte Chips und enge Partnerschaften mit Chipherstellern gehören.
„We are investing in artificial intelligence (“AI”) across the entire company and infusing generative AI capabilities into our consumer and commercial offerings."
Wir investieren unternehmensweit in künstliche Intelligenz (KI) und statten unsere Angebote fuer Verbraucher und Geschäftskunden mit generativen KI-Fähigkeiten aus.
„Microsoft Cloud gross margin percentage decreased to 67% driven by continued investments in AI infrastructure and growing AI product usage, offset in part by efficiency gains in Azure and Microsoft 365 Commercial cloud."
Die Bruttomarge von Microsoft Cloud sank auf 67 Prozent, getrieben von den anhaltenden Investitionen in KI-Infrastruktur und der wachsenden Nutzung von KI-Produkten, teilweise ausgeglichen durch Effizienzgewinne bei Azure und Microsoft 365 Commercial cloud.
Filings Reviewed: 10-Q 2026-04-29 · 10-Q 2026-01-28 · 10-Q 2025-10-29 · 10-Q 2025-04-30 · 10-K 2025-07-30 · 10-K 2024-07-30
Rated on July 29, 2026 · How the Rating Is Built
What the Earnings Calls Reveal
Red flags Promises repeatedly deferredMicrosoft delivers with notable operational reliability: quarterly guidance for Azure, revenue and margin was met or beaten almost without exception across all ten calls reviewed, and management openly admits weak spots such as the go-to-market problems in its scale motion (2025-Q2). What stands out is something else: dated commitments were repeatedly cancelled or pushed further out, and precisely those metrics that would let outsiders check the AI business appear and vanish again instead of forming a continuous series. Anyone valuing Microsoft therefore has to separate the execution, which holds up, from the disclosure, which is narrowing.
10 calls reviewed, 2024-Q2 through 2026-Q3 · As of August 2, 2026
The capacity promise was pushed out four times
In the 2025-Q2 call, CFO Amy Hood committed that the company would be 'roughly in line with near-term demand' on AI compute capacity by the end of fiscal 2025. By 2025-Q3 this had become 'some AI capacity constraints beyond June', and in the same call she conceded: 'we had hoped to be in balance by the end of Q4'. In 2025-Q4 she moved the target to December, saying: 'I thought we'd be in better supply demand shape by June. And now I'm saying I hope I'm in better shape by December.' In 2026-Q1 came the admission 'I thought we were going to catch up, we are not', together with a shortage forecast running to at least the end of the fiscal year, and by 2026-Q3 the forecast already runs 'at least through 2026'. Management attributes the cause to rising demand, not to a failure to build out. The commitment itself, however, was not met in a single one of the five following calls.
Capex brake announced, reaffirmed for three quarters, then released
In the 2025-Q2 call, management explicitly announced a lower capital expenditure growth rate for fiscal 2026 than in fiscal 2025. That statement was confirmed verbatim in 2025-Q3 ('remain unchanged') and reaffirmed again in 2025-Q4. In 2026-Q1 it was reversed: the growth rate would now be higher than in the prior year. The reasoning came in the same sentence and is plausible, namely accelerating demand and a growing contracted backlog. In numbers the reversal means a jump from 20.0 billion US dollars of quarterly capex (2025-Q1) to 37.5 billion (2026-Q2) and a calendar 2026 plan of roughly 190 billion US dollars (2026-Q3). For investors it nonetheless remains a planning figure that was confirmed for three quarters and then discarded entirely.
AI metrics come and go
From 2024-Q2 through 2025-Q3, the company disclosed in every call how many points of Azure revenue growth came from AI services: 6, 7, 8, roughly 12, 13 and finally 16 points. From 2025-Q4 onward this disclosure was dropped without replacement; since then it is only stated that AI revenue was 'generally in line with expectations'. The removal was explained a quarter earlier, in 2025-Q3, by Amy Hood: 'It's getting harder and harder to separate what an AI workload is from a non-AI workload.' The 'AI business annual revenue run rate' metric followed a similar path: announced in 2025-Q1 at 10 billion US dollars for the following quarter, put at 13 billion in 2025-Q2, then not mentioned at all for four quarters, and only picked up again in 2026-Q3 at 37 billion. The calls provide no evidence that the disclosures vanished because they had turned weak: both were discontinued right after their highest reading, and the run rate almost tripled from 13 to 37 billion US dollars during the gap. What remains is the loss of a continuous yardstick.
No Copilot seat number for two years
Between the market launch in late 2023 and the 2026-Q2 call, the company disclosed no absolute number of paid Microsoft 365 Copilot seats. Questions about Copilot's progress, among others in 2024-Q2, 2024-Q4, 2025-Q1 and 2025-Q2, were answered with proxies: share of Fortune 500 companies, number of customers with more than 10,000 seats, growth in seat adds, 'customers coming back to buy more seats'. In 2025-Q1, asked why Copilot was not visible in the numbers, Amy Hood explained that the contribution sits in Microsoft 365 Commercial ARPU and is masked there by a large volume of low-priced new seats. The first hard figure came in 2026-Q2, at 15 million paid seats, rising to over 20 million in 2026-Q3. Other Copilot products carried absolute figures throughout, for instance 1.3 million paid GitHub Copilot subscriptions in 2024-Q2 and 4.7 million in 2026-Q2. The gap therefore applied specifically to the metric for the most important new productivity product.
The question of the crossover point stays open
Since 2024-Q4, nearly every call has included the question of when capex growth will fall back below revenue growth, among others in 2025-Q1, 2025-Q3, 2025-Q4, 2026-Q2 and 2026-Q3. Management has still not named a date. It does explain the mechanism, however: in 2025-Q1 Amy Hood said capex growth would slow and revenue growth would rise, with the pace depending entirely on the pace of adoption. In 2025-Q4 she was explicit: 'I am not as focused on trying to pick a date at which revenue growth and CapEx growth will meet and cross.' In 2026-Q2 she additionally shifted the yardstick, asking that the Azure guide be read as an allocation figure, meaning what is left of scarce capacity for Azure; had all new chips been allocated to Azure, the growth rate would have been 'over 40'. That very number cannot be verified from outside. In the same call, roughly 45 percent of the 625 billion US dollar backlog came from a single partner; asked about it, Amy Hood pointed to the remaining 55 percent, some 350 billion US dollars from a broad customer base growing 28 percent, and called the partnership sound, without addressing the risk attached to the partner itself.
What was kept: margin and Azure acceleration
The counter-finding belongs here, because the actual earnings guidance was delivered reliably. For fiscal 2025 an operating margin down by roughly one point was announced from 2024-Q3 onward; in 2025-Q2 the expectation was raised to 'up slightly' and in 2025-Q4 reported as exceeded. The commitment given in 2024-Q4 that Azure growth would accelerate in the second half of fiscal 2025 was honoured: 34 and 31 percent in the first half became 35 and 39 percent in the second. Quarterly Azure guidance from 2026-Q1 onward also came in consistently below the actual result, for instance roughly 37 percent guided against 40 percent delivered in 2026-Q1. Weak spots were named rather than skirted, such as the go-to-market problems in the indirect business in 2025-Q2 and their only partial repair in 2025-Q3.
Management promises
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2024-Q4 kept
Azure growth is to accelerate in the second half of fiscal 2025 as the capital investments bring additional AI capacity online.
Met. After 34 and 31 percent growth in the first half came 35 percent in 2025-Q3 and 39 percent in 2025-Q4.
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2024-Q4 kept
The fiscal 2025 operating margin is to fall by only about one point despite the AI investments.
Exceeded. In 2025-Q2 the expectation was raised to 'up slightly', and in 2025-Q4 the company reported the commitment had been exceeded.
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2025-Q2 broken
By the end of fiscal 2025, AI capacity is to be roughly in balance with near-term demand.
Broken and then deferred four more times: to 'beyond June' (2025-Q3), to December (2025-Q4), to the end of the fiscal year (2026-Q1) and most recently to at least the end of 2026 (2026-Q3).
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2025-Q2 broken
Capital expenditure is to grow more slowly in fiscal 2026 than in fiscal 2025.
Broken. After confirmation in 2025-Q3 and 2025-Q4, the statement was reversed in 2026-Q1; quarterly spending rose to 37.5 billion US dollars by 2026-Q2.
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2025-Q4 open
For fiscal 2026, double-digit revenue and operating income growth plus a largely unchanged operating margin are put in prospect.
On track but not yet closed: revenue and operating income grew at double-digit rates from 2026-Q1 through 2026-Q3, and in 2026-Q3 the margin expectation was even raised to a gain of about one point. The full-year closing call was not yet available as of this review.
Based on public earnings call transcripts. Reviewed: 10 transcripts 2024-Q2 through 2026-Q3.
Highlighted are things our editorial team noticed: green = stands out as strong, red = deserves a closer look. No single metric is a verdict on its own — always read it in context.
Analysts & Price Target
The price target sits 21.2% above the current price.
- Consensus
- Strong Sell
- Analyst Ratings
- 61
Combined picture of the price targets and recommendations of every analyst covering the stock. Price targets are expectations for the next 12 months, not promises — and they often follow the price rather than predict it.
Estimates by Fiscal Year
| Fiscal Year | EPS Estimate ($) | EPS Range ($) | Revenue Estimate ($M) | Expected Growth | Analysts |
|---|---|---|---|---|---|
| 06/30/2027 | 19.60 | 18.93 – 20.51 | 390,796 | 13.4% | 34 |
| 06/30/2028 | 23.28 | 19.00 – 26.00 | 465,583 | 18.8% | 32 |
Average of the analyst estimates for the coming fiscal years. The range shows how far the most optimistic and the most cautious estimate sit apart — the wider it is, the less certain the expectation.
Revenue & Profit
Cash Flow
Balance Sheet
Margins
Per Share
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· Total · per year
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The figures could not be loaded right now.
Source: fundamental data
Quarterly Figures
| Quarter | EPS (Earnings Per Share) | EPS YoY (%) | Sales ($M) | Sales YoY (%) | Net Margin (%) | OCF ($M) | FCF ($M) |
|---|---|---|---|---|---|---|---|
| 2024: Q4 | 3.23 | 10.20 | 69,632 | 12.30 | 34.60 | 22,291 | 6,487 |
| 2025: Q1 | 3.46 | 17.90 | 70,066 | 13.30 | 36.90 | 37,044 | 20,299 |
| 2025: Q2 | 3.65 | 23.80 | 76,441 | 18.10 | 35.60 | 42,647 | 25,568 |
| 2025: Q3 | 3.72 | 12.50 | 77,673 | 18.40 | 35.70 | 45,057 | 25,663 |
| 2025: Q4 | 5.16 | 59.70 | 81,273 | 16.70 | 47.30 | 35,758 | 5,882 |
| 2026: Q1 | 4.27 | 23.30 | 82,886 | 18.30 | 38.30 | 46,679 | 15,803 |
| 2026: Q2 | 4.81 | 31.80 | 90,007 | 17.70 | 39.70 | 55,441 | 19,639 |
- EPS (Earnings Per Share):
- Quarterly profit divided by the total share count — how much of the profit works out to a single share.
- YoY (Year over Year):
- Change versus the same quarter a year ago — this is how you compare without seasonal distortion (e.g. the holiday shopping season).
- Sales:
- All revenue for the quarter, before any costs are deducted — the top line of the income statement.
- Net Margin:
- What percentage of sales is left over as profit in the end. Negative means the company is posting a loss.
- OCF (Operating Cash Flow):
- The cash that actually flows into the till from the core business during the quarter — harder to dress up than book profit.
- FCF (Free Cash Flow):
- Operating cash flow minus capital expenditures — the money that's genuinely free to use, say for paying down debt, buybacks, or dividends.
Annual Figures
| Fiscal Year | Revenue ($M) | EBIT ($M) | Net Income ($M) | EPS ($) | Operating Cash Flow ($M) | Equity ($M) | Total Assets ($M) |
|---|---|---|---|---|---|---|---|
| 2017 | 96,571 | 29,025 | 25,489 | 3.25 | 39,507 | 72,394 | 241,086 |
| 2018 | 110,360 | 35,058 | 16,571 | 2.13 | 43,884 | 82,718 | 258,848 |
| 2019 | 125,843 | 42,959 | 39,240 | 5.06 | 52,185 | 102,330 | 286,556 |
| 2020 | 143,015 | 52,959 | 44,281 | 5.76 | 60,675 | 118,304 | 301,311 |
| 2021 | 168,088 | 69,916 | 61,271 | 8.05 | 76,740 | 141,988 | 333,779 |
| 2022 | 198,270 | 83,383 | 72,738 | 9.65 | 89,035 | 166,542 | 364,840 |
| 2023 | 211,915 | 88,523 | 72,361 | 9.68 | 87,582 | 206,223 | 411,976 |
| 2024 | 245,122 | 109,433 | 88,136 | 11.80 | 118,548 | 268,477 | 512,163 |
| 2025 | 281,724 | 128,528 | 101,832 | 13.64 | 136,162 | 343,479 | 619,003 |
| 2026 | 331,839 | 155,237 | 133,749 | 17.95 | 182,935 | 442,387 | 758,376 |
Fiscal years from the audited annual reports, oldest first. EBIT is the operating profit before interest and taxes; total assets are everything the company owns.
Assessment: Opportunities & Risks
Commercial remaining performance obligation rose 99 percent to $627 billion as of March 31, 2026; Azure grew 40 percent over the preceding nine months and Microsoft Cloud reached $155.1 billion (prior year $122.2 billion). This is contracted revenue, not a statement of intent (10-Q as of March 31, 2026).
Operating margin of 47.4 percent in the nine months ended March 31, 2026 (prior year 45.9 percent), net margin 40.5 percent, return on equity roughly 34 percent (data as of July 28, 2026). Even stripping out the OpenAI book gain, $93.5 billion of profit remains in nine months.
Free cash flow grew only 2.8 percent in the nine months ended March 31, 2026 ($47.3 billion against $46.0 billion) while net income rose 31 percent. It had already fallen in fiscal year 2025: $71.6 billion after $74.1 billion. The cause is capital expenditure (FY 2025: $64.6 billion; nine months of FY 2026: $80.1 billion).
$4.5 billion of the $98.0 billion of net income in the nine months ended March 31, 2026 is a non-cash book gain from the dilution of the OpenAI stake. Microsoft discloses it transparently and removes it itself — the adjusted increase is 22 percent rather than 31 (10-Q as of March 31, 2026, "Non-GAAP Financial Measures").
Stockholders' equity of $414.4 billion, cash and short-term investments of $78.3 billion and bond debt of $40.3 billion as of March 31, 2026. Even including $62.9 billion of finance leases, leverage stays low relative to earning power: $2.2 billion of interest expense in nine months against $114.6 billion of operating income.
Microsoft Cloud gross margin fell to 66 percent in the quarter ended March 31, 2026; cost of revenue in Intelligent Cloud rose 45 percent over nine months against 29 percent segment revenue growth. Microsoft itself writes that its investments may decrease operating margins (10-Q as of March 31, 2026, Item 2).
Microsoft remains one of the most profitable companies on earth: a 47.4 percent operating margin, a $627 billion order book and a cloud business that grew 27 percent over nine months. The price of that sits in the same cash flow statement: $80.1 billion of capital expenditure in nine months, free cash flow that is effectively flat, and finance lease liabilities for datacenters that now exceed every bond the company has issued. On top of that comes a $4.5 billion book gain from the OpenAI dilution, which Microsoft strips out itself. Not investment advice.
- Origin: ranking of the 100 largest U.S. stocks by market value (as of July 28, 2026); Microsoft ranked fifth and had no analysis yet.
- Data cut-offs: annual figures from the Form 10-K for fiscal year 2025 (filed July 30, 2025), nine-month figures from the Form 10-Q as of March 31, 2026 (filed April 29, 2026), valuation metrics as of July 28, 2026. The Form 10-K for fiscal year 2026, which ended June 30, 2026, had not been filed as of July 29, 2026.
- Easily confused: Microsoft's fiscal year ends June 30. "Fiscal year 2026" means July 2025 through June 2026 — not calendar 2026.
- Analyses are evergreen; a daily price is not a buy argument.
About the Company
Microsoft Corporation entwickelt und betreut weltweit Software, Dienste, Geräte und Lösungen. Das Segment Productivity and Business Processes umfasst Microsoft 365 Commercial, Enterprise Mobility + Security, Windows Commercial, Power BI, Exchange, SharePoint, Microsoft Teams, Sicherheit und mehr.
| Employees | 223,000 |
|---|---|
| Headquarters | Redmond, WA |
| Address | One Microsoft Way, 98052-6399 Redmond, United States |
| Phone | 425 882 8080 |
| Website | microsoft.com |
| IPO Date | 13. Mar 1986 |
| ISIN | US5949181045 |
| Stock Split | 2:1 on 02/18/2003 |
Management
| Name | Title | Birth Year |
|---|---|---|
| Satya Nadella | Chairman & CEO | 1967 |
| Amy E. Hood | Executive VP & CFO | 1972 |
| Carolina Dybeck Happe | Executive VP & COO | 1972 |
| Alice L. Jolla | Corporate VP & Chief Accounting Officer | 1966 |
| Matthew Kerner | CTO & Corporate VP of Worldwide Sales and Solutions | – |
| Jonathan Neilson | Vice President of Investor Relations | – |
| Jonathan M. Palmer | Corporate Vice President & Chief Legal Officer | – |
| Frank X. Shaw | Chief Communications Officer | – |
| Samer Ramez Abu-Ltaif | President of Europe, Middle East & Africa (EMEA) | – |
| Yusuf I. Mehdi | Executive VP & Consumer Chief Marketing Officer | 1967 |
Executives per the latest required filings; titles kept in their original language. Source: fundamental data.
Insider Transactions
| Date | Person | Role | Type | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 15. Jul 2026 | Coleman Amy | EVP, Chief Human Resources Off | Other | 32 | 384.93 | 12,318 |
Reportable transactions by officers and major shareholders from SEC Form 4 filings. "Other" includes things like stock grants and option exercises without a buy/sell character.
View all insider transactions →Chart
Interactive price chart (TradingView).
Data as of: July 31, 2026 · Source: fundamental data & SEC filings (annual and quarterly reports, 10-K/10-Q)
Note: pure fact-based analysis, not investment advice and not a solicitation to buy or sell. All figures without guarantee.