Latest quarter Q3 2026 · Written Oct 29, 2026 03:53 ET · requested on this site
Strong earnings performance with consistent beat on estimates and solid balance sheet
Shares bought from this day on miss the next dividend, paid Thu Dec 10 (the last was $0.91 a share).
Futures put 82% on a 0.25-point hike and 18% on no change, for a rate of about 4.09% after it.
Futures put 64% on no change and 36% on a 0.25-point hike, for a rate of about 4.18% after it.
Futures put 62% on a 0.25-point hike and 38% on no change, for a rate of about 4.33% after it.
AI verdict: unchanged, bullish · quarter Q2 2026 → Q3 2026
| Metric | Then | Now | Change |
|---|---|---|---|
| Price | $543.45 | $531.01 | −2.3% |
| EPS (latest quarter) | $4.74 | $4.89 | +3.2% |
| EPS surprise | +11.8% | +3.6% | −8.2 pts |
| Revenue (TTM) | $331.84B | $331.84B | 0.0% |
| Profit margin | 40.3% | 40.3% | 0.0 pts |
Microsoft Corporation (MSFT) has delivered a strong fiscal Q3 2026 earnings report, beating analyst estimates by a significant margin. The company reported EPS of $4.89, exceeding the consensus estimate of $4.72 and representing a surprise of +3.6%. This marks the third consecutive quarter in which MSFT has beaten expectations, demonstrating a clear trend direction towards consistency. However, it's worth noting that the magnitude of the surprise has been decreasing over the past few quarters, with the latest beat being the smallest since Q2 2026.
Looking at the revenue and profitability trajectory, MSFT continues to drive growth in its core business. The company reported revenue of $95.65B, beating the consensus estimate of $92.3B and representing a year-over-year growth rate of +5.7%. Azure revenue, in particular, has been a key driver of growth, with the cloud segment reporting a 48% increase to $33.2B. This growth is expected to continue, with next quarter's EPS estimates rising by +16.4% and revenue guidance pointing to another strong fiscal year. The company's profit margin remains stable at 40.3%, while operating margin has remained consistent at 45.1%.
The full analysis is in the PDF.
Rewritten as: Our discounted cash flow model puts fair value at $340.90 a share, 36% below the $531.01 price, so on that model the shares look expensive; the price implies about 28% a year of growth for five years, against the 20% the model assumes.
This report's DCF model · “Fair value $340.90 a share against a price of $531.01”
The source says: Microsoft's operating margin was 44.3%
Morgan Stanley reiterates Overweight onMicrosoftstock after strong ... · “The company maintained margins despite AI infrastructure investments, with grossmarginat 67.2% andoperatingmarginat45.1%”
Written by the Last Guard bot from SEC filings and Yahoo Finance data, with an AI model drafting the analysis. Not investment advice.
| Operating margin |
| 45.1% |
| 45.1% |
| 0.0 pts |
| Free cash flow | $66.99B | $66.99B | 0.0% |
| P/E (trailing) | 30.3x | 29.6x | −2.3% |
| Analyst target | $589.60 | $605.12 | +2.6% |
| Report's base case | $653.17 | $652.97 | −0.0% |
| DCF fair value | $282.66 | $340.90 | +20.6% |
Figures in the analysis not found in the source data: 14.6%