Microsoft (NASDAQ:MSFT) Posts Quarterly Earnings Results

Microsoft (NASDAQ:MSFT) released its earnings results on Wednesday. The software giant reported $4.74 EPS for the quarter, beating the consensus estimate of $4.21 by $0.53, FiscalAI reports. The company had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. Microsoft had a net margin of 39.34% and a return on equity of 31.94%.

Microsoft Stock Performance

Shares of MSFT stock traded down $2.81 during trading hours on Wednesday, reaching $390.54. 31,353,403 shares of the company traded hands, compared to its average volume of 36,985,352. The firm has a 50-day moving average price of $397.04 and a 200 day moving average price of $406.36. The company has a market cap of $2.90 trillion, a P/E ratio of 23.25, a P/E/G ratio of 1.19 and a beta of 1.13. The company has a debt-to-equity ratio of 0.08, a current ratio of 1.28 and a quick ratio of 1.27. Microsoft has a 12-month low of $349.20 and a 12-month high of $555.45.

Microsoft Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Thursday, August 20th will be given a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.9%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s payout ratio is presently 21.67%.

Wall Street Analyst Weigh In

A number of equities analysts have commented on MSFT shares. Robert W. Baird decreased their price target on Microsoft from $540.00 to $500.00 and set an “outperform” rating on the stock in a research note on Wednesday, April 15th. Argus reduced their target price on Microsoft from $620.00 to $510.00 and set a “buy” rating on the stock in a report on Friday, July 10th. Citizens Jmp reissued a “market outperform” rating and set a $550.00 price target on shares of Microsoft in a research report on Tuesday. Cantor Fitzgerald reissued an “overweight” rating on shares of Microsoft in a report on Monday. Finally, Rothschild & Co Redburn cut their price target on shares of Microsoft from $450.00 to $400.00 and set a “neutral” rating on the stock in a report on Thursday, April 23rd. Forty-two research analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat, Microsoft presently has an average rating of “Moderate Buy” and an average price target of $554.73.

Insider Buying and Selling at Microsoft

In related news, CEO Judson Althoff sold 15,500 shares of the company’s stock in a transaction on Monday, June 1st. The shares were sold at an average price of $460.99, for a total value of $7,145,345.00. Following the completion of the transaction, the chief executive officer owned 110,477 shares of the company’s stock, valued at approximately $50,928,792.23. This represents a 12.30% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through this link. Also, EVP Takeshi Numoto sold 4,500 shares of the stock in a transaction on Wednesday, June 10th. The stock was sold at an average price of $402.84, for a total value of $1,812,780.00. Following the completion of the sale, the executive vice president owned 47,468 shares of the company’s stock, valued at $19,122,009.12. The trade was a 8.66% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 23,762 shares of company stock valued at $10,508,361 over the last 90 days. 0.03% of the stock is currently owned by corporate insiders.

Institutional Trading of Microsoft

Several institutional investors have recently made changes to their positions in the business. Longfellow Investment Management Co. LLC raised its position in Microsoft by 51.3% in the 2nd quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant’s stock worth $29,000 after purchasing an additional 20 shares during the period. Bernzott Capital Advisors purchased a new stake in shares of Microsoft in the fourth quarter worth approximately $34,000. Timmons Wealth Management LLC purchased a new position in Microsoft during the 4th quarter valued at $36,000. LSV Asset Management bought a new position in Microsoft in the 4th quarter valued at $44,000. Finally, University of Illinois Foundation bought a new position in Microsoft in the 2nd quarter valued at $50,000. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Key Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analysts continue to see substantial long-term upside, with Citizens JMP reaffirming a Market Outperform rating and a $550 price target. Microsoft’s Azure cloud business, enterprise software ecosystem and expanding AI capabilities remain the core bullish arguments. Microsoft Stock Moves Higher: What’s Going On?
• Positive Sentiment: Microsoft unveiled MAI-Cyber-1-Flash and Project Perception, new AI cybersecurity tools designed to detect and counter machine-speed attacks. The products could strengthen Microsoft’s security franchise, support enterprise AI adoption and create additional revenue opportunities. Microsoft launches AI cybersecurity model and defense platform
• Positive Sentiment: Microsoft’s partnership with OpenAI, AMD and other ecosystem participants continues to support its position in AI infrastructure. Investors are also encouraged by reports that customer and partner demand for Azure remains healthy. Microsoft backs bigger OpenAI Ohio build
• Neutral Sentiment: The earnings release is the primary near-term catalyst. Consensus expectations center on approximately $4.21–$4.23 in earnings per share and about $87.4–$87.6 billion in revenue, while options markets imply an unusually large post-earnings move of roughly 6% to 7%.
• Neutral Sentiment: Investors will scrutinize Azure growth, Microsoft 365 Copilot adoption, AI monetization and fiscal 2027 capital-expenditure guidance. The company’s reported plans for roughly $190 billion in annual capital spending have made Microsoft a key test of whether the broader AI infrastructure boom can deliver acceptable returns. Microsoft earnings spending plans
• Neutral Sentiment: Marketwide pressure from higher oil prices, geopolitical tensions and uncertainty ahead of the Federal Reserve’s rate decision may be influencing technology-stock trading independently of Microsoft’s fundamentals.
• Negative Sentiment: Investors are increasingly concerned that accelerating AI capital expenditures could compress margins and reduce free cash flow before revenue catches up. Alphabet’s recent spending outlook intensified skepticism toward Microsoft and other hyperscalers. Hyperscalers face higher capital-expenditure scrutiny
• Negative Sentiment: Microsoft faces a U.K. competition-regulator investigation into whether customers were misled about Microsoft 365 Personal and Family subscription pricing. Multiple securities-fraud law firms have also publicized class-action claims involving alleged AI and Copilot disclosures, adding reputational and legal overhang. UK competition regulator investigates Microsoft
• Negative Sentiment: Short interest has reached its highest level since 2015, indicating that bearish traders are positioned for disappointment if Azure growth or AI-return guidance falls short.

About Microsoft

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).