Microsoft (NASDAQ:MSFT) Posts Quarterly Earnings Results, Beats Expectations By $0.28 EPS

by · The Cerbat Gem

Microsoft (NASDAQ:MSFT – Get Free Report) posted its quarterly earnings results on Wednesday. The software giant reported $4.14 earnings per share for the quarter, topping analysts’ consensus estimates of $3.86 by $0.28, FiscalAI reports. The business had revenue of $81.27 billion for the quarter, compared to the consensus estimate of $80.28 billion. Microsoft had a return on equity of 32.45% and a net margin of 35.71%.

Microsoft Price Performance

Shares of MSFT stock traded up $1.05 on Wednesday, reaching $481.63. The company’s stock had a trading volume of 33,660,893 shares, compared to its average volume of 27,379,084. Microsoft has a 12-month low of $344.79 and a 12-month high of $555.45. The company has a market capitalization of $3.58 trillion, a P/E ratio of 34.26, a PEG ratio of 1.89 and a beta of 1.07. The company has a quick ratio of 1.39, a current ratio of 1.40 and a debt-to-equity ratio of 0.10. The stock’s 50 day simple moving average is $477.68 and its 200-day simple moving average is $500.81.

Microsoft Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Thursday, March 12th. Stockholders of record on Thursday, February 19th 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 0.8%. The ex-dividend date is Thursday, February 19th. Microsoft’s payout ratio is 25.89%.

Insiders Place Their Bets

In other news, insider Bradford L. Smith sold 38,500 shares of the business’s stock in a transaction that occurred on Monday, November 3rd. The shares were sold at an average price of $518.64, for a total value of $19,967,640.00. Following the completion of the sale, the insider directly owned 461,597 shares in the company, valued at approximately $239,402,668.08. The trade was a 7.70% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this hyperlink. Also, CEO Judson Althoff sold 12,750 shares of the business’s stock in a transaction dated Tuesday, December 2nd. The shares were sold at an average price of $491.52, for a total value of $6,266,880.00. Following the completion of the sale, the chief executive officer directly owned 129,349 shares of the company’s stock, valued at approximately $63,577,620.48. This trade represents a 8.97% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 54,100 shares of company stock valued at $27,598,872 over the last quarter. 0.03% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Microsoft

Several hedge funds and other institutional investors have recently modified their holdings of the stock. Longfellow Investment Management Co. LLC raised its holdings in Microsoft by 51.3% in the second 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 in the last quarter. Shepherd Kaplan Krochuk LLC increased its stake in shares of Microsoft by 4.9% in the 3rd quarter. Shepherd Kaplan Krochuk LLC now owns 431 shares of the software giant’s stock worth $223,000 after acquiring an additional 20 shares in the last quarter. Pollock Investment Advisors LLC lifted its position in Microsoft by 0.8% during the 3rd quarter. Pollock Investment Advisors LLC now owns 2,805 shares of the software giant’s stock valued at $1,453,000 after acquiring an additional 21 shares during the period. Better Money Decisions LLC boosted its stake in Microsoft by 0.6% during the second quarter. Better Money Decisions LLC now owns 3,498 shares of the software giant’s stock worth $1,740,000 after acquiring an additional 21 shares in the last quarter. Finally, Endowment Wealth Management Inc. grew its holdings in Microsoft by 0.4% in the third quarter. Endowment Wealth Management Inc. now owns 5,251 shares of the software giant’s stock worth $2,720,000 after purchasing an additional 21 shares during the period. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Analyst Upgrades and Downgrades

MSFT has been the topic of a number of recent research reports. BMO Capital Markets dropped their price objective on shares of Microsoft from $650.00 to $625.00 and set an “outperform” rating on the stock in a research note on Thursday, October 30th. Bank of America cut their price objective on shares of Microsoft from $640.00 to $520.00 and set a “buy” rating on the stock in a report on Monday. Wolfe Research cut their price target on shares of Microsoft from $675.00 to $625.00 and set an “outperform” rating on the stock in a report on Monday, December 15th. Mizuho dropped their target price on shares of Microsoft from $640.00 to $620.00 and set an “outperform” rating on the stock in a research report on Wednesday, January 21st. Finally, The Goldman Sachs Group upgraded Microsoft to a “strong-buy” rating in a report on Monday, January 12th. Three equities research analysts have rated the stock with a Strong Buy rating, thirty-five have given a Buy rating and three have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, the company presently has an average rating of “Buy” and an average price target of $612.58.

Read Our Latest Research Report on MSFT

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

  • Positive Sentiment: Q2 beat and cloud momentum — Microsoft reported $81.3B in revenue and produced strong Azure growth (reported +39%), with Microsoft Cloud topping $50B for the quarter, demonstrating continued demand and helping the company beat consensus across segments. Microsoft beats Q2 earnings as Azure jumps 39% and cloud revenue tops $50B
  • Positive Sentiment: Maia 200 chip could improve long-term margins — Microsoft unveiled its Maia 200 inference accelerator, which management says lowers per-query costs and energy consumption; this can help protect cloud gross margins as AI usage scales. Microsoft’s Maia 200: The Profit Engine AI Needs
  • Positive Sentiment: OpenAI-related gains boosted results — coverage notes that Microsoft’s restructuring and gains tied to its OpenAI relationship lifted EPS and helped the quarter’s profit beat, validating part of the AI investment story. Microsoft’s Earnings Surge, Elevated by Cloud Business
  • Neutral Sentiment: CFO commentary and internal focus — an internal memo from CFO Amy Hood highlights AI deals, coding initiatives and chip strategy; useful color for guidance but not a direct catalyst by itself. Microsoft CFO’s memo to staff calls out AI deals, coding, and chips
  • Negative Sentiment: Record capex raised alarm — Microsoft disclosed capital expenditures of about $37.5B, above analyst expectations (~$36.2B), signaling heavy near-term cash outlays to build AI infrastructure that can compress near-term free cash flow and margins. Microsoft drops after reporting record spending on AI hardware
  • Negative Sentiment: Investor reaction to capex and growth pacing — despite the beats, investors focused on elevated AI spending and signs of moderating cloud growth, triggering an after-hours selloff and increased sensitivity to forward guidance. Microsoft Tumbles After Cloud Growth Slows, CapEx Soars

About Microsoft

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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).

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