Microsoft Jumps 9% on Q4 Beat, $175B Capex Plan, and Bullish Azure Guidance
MSFT sits 22% above its 52-week low of $349.2.
Summary
Microsoft delivered a blowout Q4 FY2026: revenue of $90.01B beat the $87.62B consensus, and adjusted EPS of $4.74 topped expectations. Azure grew 31.6% to $39.31B, surpassing estimates, and full-year Azure revenue crossed $100B for the first time. The stock surged 9% in extended trading as the company provided clarity on its massive AI infrastructure spending. Capex is set at $175B for FY2027, with potential for further growth based on demand, and the company extended the useful life of its buildings to 25 years, easing depreciation concerns. Despite a 23% drop in free cash flow to $19.64B, CFO Amy Hood assured investors that free cash flow will remain positive in the new fiscal year. Q1 guidance calls for revenue of $89.95B-$90.95B, implying 16% growth and beating the $89.66B consensus, while Azure is expected to grow 45%, well above the 41.4% street estimate. Microsoft 365 Copilot now has over 30 million paid seats, up from 20 million in April, underscoring rapid AI adoption. This follows the 8-K and 10-K filings earlier today that detailed the strong results, but the after-hours move and forward guidance provide fresh catalysts for traders.
At the time of this announcement, MSFT was trading at $425.21 on NASDAQ in the Technology sector, with a market capitalization of approximately $2.9T. The 52-week trading range was $349.20 to $555.45. This news item was assessed with positive market sentiment and an importance score of 9 out of 10. Source: CNBC TV18.