MSFT stock jumped roughly 8% on Thursday, July 30, 2026, after Microsoft delivered a fiscal fourth-quarter earnings report that beat Wall Street expectations on every major line. The software giant posted adjusted earnings of $4.74 per share on revenue of $90.01 billion — well ahead of the roughly $4.24 per share and $87.6 billion analysts expected — while its Azure cloud business crossed $100 billion in annual revenue for the first time in company history.
Key Takeaways for MSFT Stock
- Microsoft reported Q4 FY2026 adjusted EPS of $4.74, beating the roughly $4.24 consensus, on revenue of $90.01 billion versus about $87.62 billion expected.
- Revenue grew about 18% year over year, and net income rose to $35.77 billion from $27.23 billion a year earlier.
- Azure grew 43% and topped $100 billion in annual revenue for the first time; Microsoft’s commercial backlog reached $678 billion, up 84%.
- MSFT stock climbed around 8% in early Thursday trading toward the low $420s, a sharp reversal after shares had lost about 19% in 2026 before the report.
- Capital spending remains enormous: $41 billion in Q4, with more than $50 billion expected in the current quarter to fund AI infrastructure.
Microsoft Q4 2026 Earnings: The Numbers Behind the MSFT Stock Rally
Microsoft released results for its fiscal fourth quarter, which ended June 30, after the closing bell on Wednesday, July 29. The headline figures were unambiguous: adjusted earnings per share of $4.74 against an LSEG consensus near $4.24, and revenue of $90.01 billion against expectations of about $87.62 billion, according to CNBC. Revenue grew close to 18% from the same period a year ago.
Net income came in at $35.77 billion, or $4.81 per share on a GAAP basis, up sharply from $27.23 billion, or $3.65 per share, in the year-ago quarter. Two unusual items helped the bottom line: a $3.2 billion gain tied to Microsoft’s investment in the artificial intelligence lab Anthropic, and lower-than-expected costs from the company’s first-ever voluntary retirement program. On the negative side of the ledger, Microsoft took an impairment charge related to its Xbox gaming business. The quarter extended Microsoft’s streak of consecutive EPS beats to five, reinforcing its reputation as one of the most consistent large-cap earners in technology.
Azure Tops $100 Billion: Why It Matters for MSFT Stock
The single most important storyline for MSFT stock investors was Azure. Microsoft’s flagship cloud platform grew 43% in the quarter and surpassed $100 billion in revenue for the full fiscal year — a first for the business and a milestone the company has been building toward since it bet the balance sheet on cloud infrastructure a decade ago.
The broader cloud picture was just as strong. The Intelligent Cloud segment generated $39.3 billion in quarterly revenue, comfortably above estimates, while the total Microsoft Cloud franchise topped $214 billion on an annual basis. Perhaps the most eye-catching figure of all: Microsoft’s commercial remaining performance obligations — essentially contracted future revenue — reached $678 billion, up 84% year over year. Management also said Microsoft 365 Copilot has passed 30 million paid seats, a signal that enterprises are actually paying for AI features rather than just piloting them.
For a market that has spent 2026 asking whether massive AI investments will ever translate into revenue, those numbers were the closest thing to a direct answer any Big Tech company has offered this earnings season.
A Rough 2026 for Microsoft Stock Turns a Corner
The rally matters more because of where MSFT stock was coming from. Heading into the report, Microsoft shares had given up about 19% in 2026, badly trailing the S&P 500’s roughly 7% gain, as investors punished legacy software names on fears that generative AI could disrupt their core businesses. Thursday’s move — with the stock climbing around 8% toward the low $420s in early trading, per Yahoo Finance — clawed back a meaningful piece of that decline in a single session.
The contrast with the rest of Big Tech’s week was striking. While Microsoft stock rallied, Meta stock tumbled after its own Q2 report missed profit expectations under the weight of legal charges and an aggressive AI spending plan — a reminder that investors are rewarding AI results, not just AI ambition.
Guidance and the $50 Billion Capex Question
Looking ahead, Microsoft guided fiscal first-quarter revenue to a range of $89.85 billion to $90.95 billion, implying growth of roughly 16% to 17%, with Azure expected to grow about 45% in constant currency amid what management described as persistent supply constraints — in plain English, demand for AI computing still exceeds what Microsoft can build.
Building it is not cheap. Capital expenditures, including leases, hit $41 billion in the fourth quarter alone, slightly below the roughly $42 billion analysts anticipated, and the company expects to spend more than $50 billion in the current quarter on AI infrastructure. That level of spending pressures margins as the revenue mix shifts toward cloud, and it remains the central tension in the MSFT stock story: extraordinary demand on one side, an extraordinary bill on the other.
The Anthropic Gain and Other One-Time Items, Explained
Investors reading the MSFT stock headlines should understand what was and wasn’t “clean” in this quarter. The GAAP net income figure of $35.77 billion benefited from a $3.2 billion gain on Microsoft’s investment in Anthropic, the AI lab behind the Claude models — a paper gain that reflects the soaring valuation of Microsoft’s AI partnerships rather than product sales. Profit also got a lift because Microsoft’s first-ever voluntary retirement program, a cost-cutting measure announced earlier in the year, ended up costing less than the company had budgeted.
Pulling in the other direction, Microsoft recorded an impairment charge against its Xbox gaming unit, an accounting acknowledgment that parts of that business are worth less than previously carried on the books. Netting it all out, analysts note that even setting aside the unusual items, the operating story — 18% revenue growth, Azure at 43%, a $678 billion backlog — was strong enough on its own to justify Thursday’s move in MSFT stock. That distinction matters for anyone comparing this quarter to future ones: the Anthropic gain will not repeat every three months, but cloud demand of this magnitude has shown no sign of slowing.
The Soft Spots: Xbox and Windows
The report was not flawless. Xbox revenue declined 10%, and the gaming unit absorbed an impairment charge in the quarter. Earlier in July, gaming chief Asha Sharma announced job cuts and said four studios would spin out of the company, while Microsoft also lowered Xbox Game Pass subscription prices — moves that suggest a business still searching for its post-console economic model.
Sales of devices and Windows licenses to PC makers fell 7%, roughly consistent with research firm Gartner’s estimate that global PC shipments declined 4.2% in the period. Neither business is central to the bull case for MSFT stock at this point, but both serve as a reminder that not every division is riding the AI wave.
What Comes Next for MSFT Stock
Microsoft is expected to report fiscal first-quarter results in late October 2026. Between now and then, analysts say the debate will center on three questions: whether Azure can sustain growth above 40% at its new scale, whether capital spending above $50 billion per quarter starts showing clear returns, and whether the enterprise AI adoption signaled by Copilot’s 30 million paid seats keeps compounding. After Thursday’s move, MSFT stock has momentum for the first time in months — the question Wall Street is asking is whether one great quarter marks the start of a trend or a one-time relief rally.
Frequently Asked Questions
Why is MSFT stock up today?
MSFT stock rose about 8% on July 30, 2026, because Microsoft’s fiscal Q4 earnings beat expectations, with $4.74 in adjusted EPS on $90.01 billion in revenue, and Azure annual revenue topped $100 billion for the first time.
What were Microsoft’s Q4 2026 earnings results?
Microsoft reported adjusted EPS of $4.74 versus roughly $4.24 expected, revenue of $90.01 billion versus about $87.62 billion expected, and net income of $35.77 billion, up from $27.23 billion a year earlier.
How fast is Microsoft Azure growing?
Azure grew 43% in the fiscal fourth quarter and exceeded $100 billion in annual revenue for the first time. Microsoft guided Azure to grow about 45% in constant currency in the current quarter.
When is Microsoft’s next earnings report?
Microsoft is expected to release its fiscal Q1 2027 earnings in late October 2026, with guidance calling for revenue between $89.85 billion and $90.95 billion.
More Trending Stories on Addresx
Big Tech’s earnings week cut both ways: see why Meta stock dropped 9% after a rare profit miss, and catch up on the night Megan Moroney’s Denver show stopped after three songs. More markets coverage is on the Addresx homepage.
This article is for informational purposes only and does not constitute financial or investment advice. Figures reflect reporting from CNBC, Yahoo Finance and company disclosures as of July 30, 2026; stock prices change constantly.
