GoKawiilMicrosoft CEO Satya Nadella speaks during the Microsoft AI Tour event in Munich, Germany, on Feb. 25, 2026.
Microsoft reported better-than-expected quarterly results on Wednesday and told investors that capital expenditures for the year will reach $190 billion due to soaring memory costs.
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.
With respect to guidance, Microsoft's finance chief, Amy Hood, called for $86.7 billion to $87.8 billion in fiscal fourth-quarter revenue. The middle of the range, at $87.25 billion, was below LSEG's $87.53 billion consensus. Microsoft foresees Azure cloud growth between 39% and 40% at constant currency, above StreetAccount's 37% consensus.
Hood's forecast implies that Microsoft's operating margin for the fiscal fourth quarter will tick down to 44% from 46.3%, and will be narrower than StreetAccount's 44.6% consensus.
Microsoft reported $31.9 billion in fiscal third-quarter 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.
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