Stock price when the opinion was issued
Giant cashflow generator. Great dividend grower, though dividend's not big. Making new highs. Winner in cloud, lots of opportunity with Copilot. Great business platforms generate fees. He does have a significant underweight in tech, only about 7%. Expensive, but proved it can execute. Large-cap growth is one of the strongest areas of the market.
EPS of $3.65 beat estimates of $3.37; revenue of $76.44B beat estimates of $73.89. EBITDA of $45.5B beat estimates by 15%. Microsoft's commercial remaining performance obligations of $368 billion in fiscal 4Q, more than $50 billion above 3Q, gives confidence in another year of mid-double-digit sales growth. Estimates for 13% gains next year will likely move up, led by Azure, which could expand 34-36% in 2026. Capital-spending consensus including leases is another metric that may see an upward revision, with analysis suggesting $118 billion for 2026, up 34%. AI workloads gaining scale and double-digit sales growth could help lift 2026 operating margin above 2025. In addition, tight cost control, particularly on head count, could offset any gross-margin pressure from a shift in sales mix to lower-margin cloud infrastructure and greater depreciation. We think AI is a big factor here, as the company, while spending lots of money, is getting good customer traction. But we think underlying customer growth is very much a part of the good results as well.
Unlock Premium - Try 5i Free