GoKawiilMicrosoft CEO Satya Nadella speaks during the Microsoft AI Tour event in Munich, Germany, on Feb. 25, 2026.
Microsoft shares slipped 2% on Wednesday after the software maker reported more robust fiscal third-quarter results than analysts had expected. Capital spending came in lower than anticipated.
Here's how the company did in comparison with LSEG consensus:
Earnings per share: $4.27 adjusted vs. $4.06 expected
$4.27 adjusted vs. $4.06 expected Revenue: $82.89 billion vs. $81.39 billion expected
Microsoft's revenue grew 18% year over year in the quarter, which ended on March 31, according to a statement.
Net income of $31.78 billion, or $4.27 per share, was up from $25.82 billion, or $3.46 per share, in the same quarter a year earlier. Adjusted earnings exclude a $14 million decrease in net income from Microsoft's OpenAI investments.
Microsoft reported $31.9 billion in quarterly capital expenditures and finance leases, up 49% and less than the $34.9 billion consensus among analysts polled by Visible Alpha. Gross margin, at 67.6%, was the narrowest since 2022, as depreciation costs mounted in connection with the company's data center infrastructure build-out.
Revenue from Microsoft's Azure and other cloud services surged 40%. Analysts polled by StreetAccount and CNBC had expected 39.3% and 38.8%, respectively.
The full Intelligent Cloud segment containing Azure, server products and GitHub and Nuance cloud services posted $34.68 billion in revenue. The sum came in higher than the $34.27 billion consensus among analysts surveyed by StreetAccount.
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