Microsoft Corporation
MSFT.US Full Coverage
Last updated:
Volume
52W avg
Day Range
52W High
52W Low
Market Cap
Div Yield
Forward P/E
P/B
Headlines
FY2026 Q3
Microsoft posted Q3 FY2026 results that exceeded its own guidance, with revenue of $82.9 billion. The cloud segment grew 29% to $54.5 billion, the AI business reached a $37 billion annual revenue run rate—up 123% year‑over‑year—and Azure revenue accelerated 40% (39% in constant currency). Management outlined a roughly $190 billion capital‑expenditure plan for calendar‑year 2026 and noted that AI capacity constraints are expected to persist through at least the end of 2026.
Total Revenue
$82.9B
↑ 18% YoY
Azure & Other Cloud Services Growth
40%
↑ 700 bps YoY
AI Business Annual Revenue Run Rate
>$37B
↑ 123% YoY
Paid M365 Copilot Seats
>20M
+5M QoQ
FY2026 Operating Margin Outlook
Up ~1 pt YoY
Maintained
What We're Watching
Risk
Extended Capacity Constraint & CapEx Execution
📅
Ongoing (through CY2026)
What to Monitor
Any further extension of the capacity constraint timeline beyond calendar 2026. Commentary on the execution of the ~$190 billion CY2026 CapEx plan, including progress on securing power, land, and supply chain components to support this unprecedented scale.
Why It Matters
Management extended the capacity constraint timeline again, signaling that demand continues to outpace even an accelerated build-out. Successfully executing a capital plan of this magnitude is a primary operational challenge and is critical to converting the massive RPO backlog into revenue.
Strategic
"Per User and Usage" Business Model Transition
📅
Ongoing
What to Monitor
The impact of this transition on bookings and renewal rates across core franchises like M365 and Security. The revenue and adoption impact of the new GitHub Copilot usage-based pricing model, effective June 1, 2026.
Why It Matters
This is a fundamental shift in how Microsoft monetizes its core software assets. While it aligns revenue with customer value, it introduces near-term risks of budget friction and bookings volatility, as seen with the new Dynamics 365 headwind.
Opportunity
M365 Copilot Seat & Usage Momentum
📅
Next Quarter
What to Monitor
The pace of net paid seat additions in Q4, which management guided would increase sequentially from the strong Q3 performance (>20M total seats). Growth in usage intensity (queries per user, MAU growth) to validate that new seats are converting to active, habitual use.
Why It Matters
M365 Copilot is the flagship for Microsoft's AI application strategy and a key driver of the "full stack ROI." Sustaining the rapid seat and usage acceleration is critical to justifying the massive infrastructure investment and proving the value of the new hybrid business model.
Risk
Dynamics 365 Bookings Headwind
📅
Next Quarter
What to Monitor
Whether the "weaker renewals" impacting Dynamics 365 bookings persist or worsen. The Q4 revenue growth guidance for Dynamics 365 of "low double digits" marks a sequential deceleration from Q3's 17% (CC) growth.
Why It Matters
This is the first concrete, negative financial indicator of the disruption caused by the seat-to-consumption business model transition. It serves as a key test case for how effectively Microsoft can manage customers through this change in its other major franchises.
Operational
FY2027 Financial Framework Execution
📅
Ongoing
What to Monitor
Early indicators of execution against the preliminary FY2027 framework, including headcount trends following the Q4 retirement program and the ability to maintain OpEx discipline while continuing to invest heavily in AI R&D.
Why It Matters
Management set a high bar for FY2027 with a framework of double-digit revenue/operating income growth alongside a year-over-year headcount decrease. Achieving this requires significant operational leverage and productivity gains, making it a key measure of long-term efficiency.
