Track market-moving stories before they get noisy

Chelsea Counsel Co. lessened its position in Microsoft Corporation (NASDAQ: MSFT) by 16.9% in the first quarter, according to its most recent disclosure with the SEC. The firm owned 17,488 shares of the software giant's stock after selling 3,560 shares during the period. Microsoft makes up about 2.8% of Chelsea Counsel Co.'s holdings,

Microsoft (MSFT) posted stellar quarterly results, with revenue up 18% and operating income rising 21%, driven by Azure's 43% growth and efficiency gains. Azure's acceleration, robust backlog, and successful Copilot adoption highlight strong execution, but valuation has become less attractive after the recent rally. Commercial RPO surged 84% to $678B, with growth increasingly diversified beyond OpenAI, addressing concentration concerns and supporting the medium-term growth thesis.

Most earnings-season numbers are designed to be seen: revenue growth gets announced, earnings per share gets a headline, capital expenditure plans get a slide. The line that reveals who holds power in a commercial relationship rarely receives that treatment because it sits on the cash flow statement in a category most readers skim past: the change in accounts receivable.

When receivables grow faster than the underlying business, a company is quietly financing its customers. Andrew Sather, on The Investing for Beginners Podcast, made the case that “sometimes that can signal kind of power dynamics between two companies,” and he pointed to Microsoft (NASDAQ:MSFT | MSFT Price Prediction) as the example worth studying. The reason his framing matters now is that the artificial intelligence buildout is being financed as much through working capital as through capital expenditure, and the shape of those balances is visible before it shows up in a headline growth rate.

What the Receivables Line Actually Reveals
Microsoft’s current net receivables stood at $80.876 billion at the close of fiscal 2026, up from $69.905 billion a year earlier and $56.924 billion the year before that.

The direction is steady and upward. Sather’s argument is that a supplier extending ever larger amounts of unpaid credit to a dominant customer sits in a different negotiating position than one that collects on time. He attributes part of Microsoft’s pattern to its compute relationship with OpenAI, though that connection is his interpretation rather than a disclosed fact. The broader point holds: concentration multiplies collection risk and the leverage the customer has when contracts come up for renewal.

Sather frames this as “Everything depends on context. Everything has kind of levels to it,” rather than a way to label a company good or bad. A rising receivables balance at a company sitting on Microsoft’s cash reserves signals something different than the same pattern at a smaller supplier without them. He offers the counterexample of heavy equipment sold into multi-year data center construction, where large outstanding balances describe the normal shape of the business.

The Other Side of the Ledger
The mirror image of receivables is contracted revenue not yet recognized, and this is where Microsoft’s position looks like a company that has bound its customers in. Commercial remaining performance obligations grew 84% to $678 billion, with a weighted-average duration of 2.3 years and roughly 30% expected to convert to revenue in the next 12 months.

CFO Amy Hood noted that “all sequential commercial RPO growth was driven by commitments from customers outside of frontier model companies,” and that RPO increased 25% when excluding OpenAI. That disclosure answers the concentration question most directly and deserves to be read alongside the receivables line.

Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) has run a similar playbook at smaller scale, with a cloud backlog that recently crossed $460 billion, and NVIDIA (NASDAQ:NVDA) sits on the hardware side of the same trade with $38.466 billion in receivables, a figure reflecting the payment terms typical of channel distribution rather than a subscription business. Reading Microsoft’s receivables line in isolation misses that Azure grew 43% in the quarter and crossed $100 billion in annual revenue for the first time.

What an Ordinary Investor Should Do With This
Track the change over several years rather than a single snapshot. Ask whether one customer represents a large enough share of revenue that a collection delay would matter, and look at related disclosures, particularly any allowance for doubtful accounts and any deferred or unearned revenue, which describes the opposite situation of cash collected before the work is done.

Microsoft’s operating cash flow reached $182.9 billion in fiscal 2026, on net income of $133.7 billion, against capital expenditures of $115.9 billion. A rising receivables balance at a business generating that much cash is a different conversation than the same pattern at a company financing growth with debt.

The weight an ordinary investor should give this line is real but bounded. It is a useful early indicator of who is bending toward whom in a contract negotiation and deserves attention during an infrastructure buildout of this scale, when the most consequential relationships in AI are being written into multi-year commitments before they are visible in reported revenue.

It complements, rather than replaces, reading what the company says about concentration, duration, and collections, and it stops well short of a conclusion about credit risk at a firm carrying $758 billion in total assets. Sather’s contribution is to remind readers that revenue growth is the number that is easiest to report and hardest to trust, and that the working capital lines are where the story often shows up first.

Contact [email protected] for any questions or corrections.

Tim Nyland offers his bearish and bullish thoughts for the back half of 2026 on expectations that the Fed will hold interest rates. He considers the broadening price action across Wall Street healthy for stocks long-term as investors reconsider previous views on AI CapEx.

Microsoft's stock is trading well below the earnings multiple it has averaged over the past five years. It has some promising opportunities ahead due to artificial intelligence, and it recently reached 30 million paid subscriptions for Microsoft 365 Copilot.

Microsoft MSFT shares fell about 3.2% on Monday after a Guardian investigation raised questions about whether the company has enough advanced chips installed to support its rapid artificial intelligence infrastructure expansion.

The report pointed to a potential gap between Microsoft's stated data-center expansion and the number of AI chips installed across its facilities.

Microsoft disputed the calculations, saying the estimates were based on incorrect assumptions.

The concerns come shortly after JPMorgan raised its price target on Microsoft, citing stronger growth prospects for Azure and Microsoft 365 Commercial Cloud as AI infrastructure spending accelerates.

The Guardian reported that Microsoft had 2.2 million AI chips installed in its global data centers, based on internal documents reviewed by the publication.

That compares with an earlier target of 1.8 million chips by the end of 2024. The report said the figure was lower than some estimates based on Microsoft's stated data-center capacity.

Microsoft has said it added 5 gigawatts of data-center capacity over the past two years as part of its AI buildout and now operates hundreds of data centers across five continents.

However, estimating the number of operational facilities and AI chips remains difficult because the company reports capacity largely in terms of power rather than individual chips.

Shaolei Ren, a professor at the University of California, Riverside, questioned whether Microsoft's reported capacity figures provide enough context. “They are giving insufficient context,” Ren said, while noting that Microsoft's audited sustainability reports provide another measure of its infrastructure.

Microsoft rejected the Guardian's calculations, saying they drew “the wrong conclusions from incorrect assumptions.” The company also said it does not disclose the volume of specific chips used in its AI infrastructure.

The concerns over chip availability contrast with JPMorgan's more bullish view of Microsoft's AI business.

The bank raised its December 2027 price target to $625 from $550 and maintained an Overweight rating.

Analyst Samik Chatterjee said the company could see accelerating growth in Azure and Microsoft 365 Commercial Cloud, with AI infrastructure investment serving as a key driver.

Chatterjee also pointed to Microsoft's Copilot products as an important source of potential revenue growth.

He estimated that stronger Copilot adoption could generate between $24 billion and $41 billion in additional revenue, before potential monetization through AI credit sales.

Microsoft's AI infrastructure spending has also helped support Azure, with Chatterjee highlighting what he described as consistent execution and recent acceleration in the business.

The Guardian report suggested that the issue may not necessarily be a shortage of chips.

Microsoft CEO Satya Nadella previously said the company could have chips sitting in inventory that could not be used because of a lack of completed data-center facilities and available electricity. “It’s not a supply issue of chips,” Nadella said.

The report also highlighted Microsoft's Fairwater data-center project in Wisconsin and Georgia, saying parts of the development appeared to remain unfinished despite earlier comments that the Wisconsin facility was going live.

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Microsoft (NASDAQ: MSFT | MSFT Price Prediction) and Alphabet (NASDAQ: GOOGL) both closed their latest quarters with cloud growth that dwarfed the rest of the hyperscaler field. Microsoft posted $90.01 billion in fiscal Q4 revenue, while Alphabet delivered $119.80 billion in its Q2. Both are pouring cash into AI infrastructure at a scale no rival can match, and their results just showed why the gap is widening.

Azure Scales the Ladder. Google Cloud Sprints Up It. Microsoft’s Intelligent Cloud segment printed $39.31 billion, up 32%, with Azure growing 43% and crossing $100 billion in annual revenue for the first time. Satya Nadella framed the moment plainly: “We are advancing the frontier on the cost-to-outcome curve, ensuring every customer can turn tokens into business results.” Copilot now sits at over 30 million paid seats, anchored by anchor deployments like NHS England (505,000 clinicians) and EY (400,000 employees).

Alphabet’s Google Cloud, meanwhile, accelerated to 82% growth on $24.77 billion. Sundar Pichai noted nearly 90% of the Fortune 100 use Gemini Enterprise, while the Gemini App reached 950 million monthly active users. Off a smaller base, Google is compounding faster.

Two Cash Engines, Two Financing Playbooks The real separator is what happens under the capex avalanche. Microsoft spent $35.80 billion on capex in Q4 and still generated $19.64 billion of free cash flow. Alphabet spent $44.92 billion and slipped to negative $5.86 billion FCF, raised roughly $70 billion in equity and debt, and suspended buybacks. Both firms lean on custom silicon (Microsoft’s Maia and Alphabet’s TPUs) to compress unit economics in a way peers reliant purely on third-party chips cannot easily match.

Lens Microsoft Alphabet Cash cushion High-margin enterprise SaaS Search and YouTube ad engine Contracted backlog $678B RPO, +84% $460B+ cloud backlog 2026 capex $115.95B FY26 $175B to $185B guide Buybacks Ongoing plus dividend Suspended in Q2 What I’m Watching Into 2027 The next test is whether capex converts to durable margin. Microsoft guided to approximately 45% Azure growth in constant currency for Q1 FY27, and Amy Hood flagged that demand continues to exceed supply. For Alphabet, the question is when Google Cloud’s operating income catches up to its top-line pace, and whether ad revenue can keep absorbing an interest expense that jumped roughly 5x year over year.

Why I Lean Microsoft for Stability, Alphabet for Upside On the data, Microsoft profiles as the steadier compounder. A 27 P/E on that RPO base and positive FCF while spending like a utility is rare. Analysts agree, with 95% bullish sentiment and a $569.56 target. Alphabet is the higher-variance pick. Its cloud is accelerating faster and shares carry 27.48% modeled upside to $440.96, but negative FCF and suspended buybacks demand patience. Investors prioritizing ballast may find Microsoft’s profile more appealing, while those seeking sharper AI beta may gravitate to Alphabet.

Contact [email protected] for any questions or corrections.

Every bull market eventually asks investors to squint past a number they'd rather not look at.

Glenmede Trust Co. NA lessened its stake in Microsoft Corporation (NASDAQ: MSFT) by 1.1% in the first quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The firm owned 1,541,064 shares of the software giant's stock after selling 17,299 shares during the period. Microsoft makes

Dala Group LLC purchased a new position in Microsoft Corporation (NASDAQ: MSFT) in the first quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The fund purchased 4,833 shares of the software giant's stock, valued at approximately $1,796,000. Microsoft comprises about 1.5% of Dala Group

The chips are quite small and some can be held in the palm of a hand. They are fundamental to the development of artificial intelligence models – and the world’s biggest technology companies need vast numbers of them to keep ahead.

Microsoft is one of them. And, on paper, it seems to have a problem. A Guardian investigation has found an apparent discrepancy between what the company has said about its AI capacity – and the number of advanced AI chips it has in operation.

It is not a small shortfall either. Microsoft reportedly targeted having 1.8m AI chips installed in its datacentres around the globe by the end of 2024. Nearly two years on, in the middle of a $280bn (£208bn) expansion, the company has 2.2m AI chips installed, according to internal documents seen by the Guardian. This is less than half the number some experts had imagined.

Put simply, the global AI arms race requires a massive build-out of datacentres that run on extremely expensive chips. The apparent discrepancy over the chips suggests Microsoft’s newest datacentres may not be fully operational or, if they are, they do not have the chips they need.

Nvidia’s microchips are integral to the boom in datacentre development. Photograph: NurPhoto/Getty ImagesThis highlights something even more fundamental about charting the progress being made in the development of AI technologies. The chips that power AI are made by Nvidia, one of the two most valuable companies in the world. Its supply chain is one of the most tightly held secrets in the entire industry.

With almost no exceptions, Nvidia does not report how many of these chips it sells or to whom. Its clients, the world’s biggest tech companies, in turn do not reveal how many they have. Without this information, it is very hard for anyone to know whether AI is booming or not.

Microsoft: a power vacuum?In the past two years, Microsoft says it has built AI infrastructure at breakneck speed. Its chief executive, Satya Nadella, said last year it would double its global datacentre footprint by mid-2027. Since 2022 it has ploughed roughly $280bn into the land, buildings and computational infrastructure to build AI. This includes more than $41bn in the past quarter.

But it is difficult to estimate how many datacentres Microsoft has built with this money.

It is possible to assess the progress that the company is making by looking at what it has announced publicly, with a particular eye on the power it needs. Datacentres need electricity, so one way of estimating how many datacentres are operational is to add up the energy Microsoft has at its disposal – its AI capacity.

Microsoft’s own claims, set out in annual reports and quarterly earnings, suggest it has added 5GW of datacentre capacity over the past two years as part of its AI build-out. It says it now has hundreds of datacentres on five continents.

Five gigawatts is a dizzying amount of energy – it is four times the size of the largest datacentre park in Europe. But Microsoft’s total capacity should be even greater than this; it has been building AI infrastructure since 2022. How much greater is an open question.

The hardware inside a Microsoft datacentre campus. Photograph: Audrey Richardson/ReutersIn an investor presentation from 2024, Microsoft reportedly claimed to have 5GW of datacentre capacity already installed. That would suggest it could now have a total of 10GW of capacity. It is unclear if all of these are AI datacentres – some could be for other cloud services. But Microsoft’s own statements indicate that the overwhelming focus of its capital expenditures in recent years has been to build AI infrastructure.

Ten gigawatts of AI datacentres would suggest Microsoft should have roughly 6.4m graphics processing units (GPUs). Shaolei Ren, a professor at the University of California, Riverside, said Microsoft’s sustainability reports, which contain figures for its electricity usage and are published separately from its financials, painted a different picture.

He said these reports suggest Microsoft’s AI capacity in 2024 was probably closer to 1.2GW. But even this lower figure would indicate Microsoft would need roughly 4m AI chips – if it added 5GW of AI datacentres in the past two years.

“According to their own metrics, Microsoft could be correct. But it isn’t clear what they mean when they say they have added datacentre capacity. They are giving insufficient context,” Ren said. “The sustainability reports are audited by a third party. They have more credibility than announcements.”

An analyst who specialises in Nvidia said they thought Microsoft would have more chips, given its public statements. “They’re low to me. They’re less than I expected Microsoft would have,” they said.

Microsoft insisted the Guardian’s calculations were based on incorrect information. It did not offer any insight as to which of the Guardian’s numbers were incorrect or why. What is clear is that Microsoft’s build-out of AI capacity appears to be going far more slowly than its annual reports may suggest.

Ren said: “It may be plausible to secure or announce 1GW of power capacity within a single quarter on paper. But bringing that capacity online and actually using it for computing within the same quarter would be far more difficult.”

Sources within Microsoft say the company’s total number of AI chips has “barely moved” over the past year.

Some of the apparent discrepancy may be explained by Microsoft’s tie-up with OpenAI. The exact terms of their commercial partnership are not public, but this unit may account for some of Microsoft’s datacentre deployments, which would not be in the documents the Guardian has seen.

A Microsoft datacentre in Middenmeer, the Netherlands. Photograph: ANP/Shutterstock‘You may have a bunch of chips … you can’t plug in’There is another factor: some of Microsoft’s big projects appear to be far from operational.

Take Microsoft’s largest AI development in the US, a pair of datacentres in Wisconsin and Georgia called Fairwater. In April, Nadella, Microsoft’s chief executive, said the Fairwater project in Wisconsin “is going live”.

Satellite footage of the building from Epoch AI, however, appears to indicate only part of it is operational. In May, Microsoft admitted to a Wisconsin newspaper that Fairwater was not yet online.

This is very common, said Ren. Initially it was a multi-gigawatt, multibillion-dollar investment. Three years later, only 300MW has been built.

Satya Nadella said last year Microsoft would double its global datacentre footprint by mid-2027. Photograph: Jeff Chiu/APThe internal document also indicates Microsoft has fewer of Nvidia’s newest model of chip, the Blackwell, than one might expect given Nvidia’s public announcements. Last March, Nvidia’s chief executive, Jensen Huang, said orders for Blackwells from Nvidia’s top four customers – widely thought to be Amazon, Oracle, Microsoft and Google – amounted to 3.6m.

There was no breakdown given for this figure, but Microsoft has historically been one of Nvidia’s largest customers. If this was still the case, that should put Microsoft’s total Blackwell holdings at somewhere close to 1m chips. In fact, it has less than half of this amount installed.

Where are the chips, if not in the datacentres?Nvidia’s balance sheets appear to indicate that it has sold a great many chips; it posted a revenue of $215.9bn in February. Has Microsoft bought these but not installed them? How many, and are all of them in its possession?

Nadella appeared to gesture at this question on a podcast late last year called All Things AI, where he talked about Microsoft’s datacentre build-out. The biggest problem, he said, was electrical power and building datacentres close enough to where power was located.

“If you can’t do that, you may actually have a bunch of chips sitting in inventory that I can’t plug in. In fact, that is my problem today. It’s not a supply issue of chips. It’s actually the fact that I don’t have warm shells to plug into.”

A Microsoft spokesperson said: “Over several decades, Microsoft has built a global infrastructure to meet rapidly growing customer demand for cloud and AI services. Our datacentres combine custom silicon, AMD, Intel and Nvidia chips across multiple generations with the networking, storage and systems infrastructure required to operate at scale.

“Microsoft does not report on the volume of specific chips in its AI infrastructure. The estimates the Guardian has shared with us are inaccurate, drawing the wrong conclusions from incorrect assumptions.”

Nvidia did not respond to a request for comment.

How to calculate numbers of chips from a company’s ‘AI capacity’The world’s biggest technology companies give figures for their AI capacity in terms of power: gigawatts. One gigawatt powers between 700,000 and 1m homes. Meta says its controversial Hyperion datacentre in Louisiana will have 5GW of capacity. The UK company DataVita is planning a 1GW datacentre in Lanarkshire.

Converting these figures into chips means calculating how many chips can be run with that amount of power. The Guardian used the following methodology, reviewing these calculations with Abdeltawab Hendawi, a professor at the University of Rhode Island, and Ren.

To get a very broad approximation of how many chips there are in a datacentre, you could divide the power usage of that datacentre by the power usage of an AI chip – for example, an H100. A single H100 uses 700W. If Microsoft has 10GW of capacity, dividing this by 700 watts suggests it should have 12m chips.

H100s make up the bulk of the chips described in the internal document. It also indicates that Microsoft has A100s, which use less power, and Blackwells, which use more.

But this approximation does not account for several factors. First, datacentres have cooling systems and other equipment, which also use electricity. Ren estimates that in a given AI datacentre, 80% of the electricity goes to computer chips. This is roughly in accordance with figures from the International Energy Agency, although the number depends on the efficiency of the datacentre. Eighty per cent of 10GW would suggest 8GW may actually be in use.

This is slightly lower than Microsoft’s own figures for its datacentre efficiency, which appear in a 2024 sustainability report and suggest that 89% of the electricity in its new datacentres powers the IT systems, with an 11% overhead.

Second, not all the chips in a datacentre are AI chips. Instead, AI chips are fitted on to server racks with other computer chips, such as memory chips, that help them run calculations. A server with eight H100 GPUs uses a maximum of about 10kW of power.

Dividing 8GW by 10kW gives 800,000 servers, or 6.4m chips.

This is a conservative estimate, as in practice companies such as Microsoft oversubscribe their power capacity to some extent – putting more chips in a datacentre than can be supported by their IT capacity, said Ren.

Boothe Investment Group Inc. purchased a new stake in Microsoft Corporation (NASDAQ: MSFT) in the first quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor purchased 15,635 shares of the software giant's stock, valued at approximately $5,788,000. Microsoft comprises 1.9%

FinArc Investments Inc. acquired a new position in shares of Microsoft Corporation (NASDAQ: MSFT) in the first quarter, according to its most recent filing with the Securities and Exchange Commission. The institutional investor acquired 7,106 shares of the software giant's stock, valued at approximately $2,630,000. Microsoft makes up approximately 2.5% of FinArc Investments

Compass Capital Management Inc. raised its stake in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 2.6% in the 1st quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC). The fund owned 171,001 shares of the software giant’s stock after purchasing an additional 4,292 shares during the quarter. Microsoft accounts for about 3.7% of Compass Capital Management Inc.’s holdings, making the stock its 4th biggest holding. Compass Capital Management Inc.’s holdings in Microsoft were worth $63,300,000 as of its most recent filing with the Securities and Exchange Commission (SEC).

A number of other hedge funds and other institutional investors have also bought and sold shares of the stock. Vanguard Group Inc. boosted its holdings in shares of Microsoft by 2.3% in the 4th quarter. Vanguard Group Inc. now owns 717,942,580 shares of the software giant’s stock worth $347,211,391,000 after purchasing an additional 15,955,898 shares in the last quarter. State Street Corp raised its holdings in shares of Microsoft by 2.1% during the 4th quarter. State Street Corp now owns 306,150,608 shares of the software giant’s stock valued at $148,060,557,000 after buying an additional 6,388,930 shares in the last quarter. Geode Capital Management LLC raised its holdings in shares of Microsoft by 1.1% during the 4th quarter. Geode Capital Management LLC now owns 182,618,400 shares of the software giant’s stock valued at $88,056,019,000 after buying an additional 1,911,142 shares in the last quarter. Morgan Stanley lifted its position in Microsoft by 0.8% in the 4th quarter. Morgan Stanley now owns 121,220,561 shares of the software giant’s stock worth $58,624,690,000 after buying an additional 980,439 shares during the last quarter. Finally, Norges Bank bought a new stake in Microsoft in the 4th quarter worth approximately $50,664,631,000. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Insiders Place Their Bets
In other Microsoft news, CEO Judson Althoff sold 10,000 shares of the stock in a transaction on Wednesday, August 5th. The shares were sold at an average price of $487.89, for a total transaction of $4,878,900.00. Following the completion of the sale, the chief executive officer owned 100,447 shares of the company’s stock, valued at $49,007,086.83. This represents a 9.05% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, EVP Takeshi Numoto sold 4,810 shares of the firm’s stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the completion of the sale, the executive vice president directly owned 42,677 shares in the company, valued at approximately $21,188,276.96. This trade represents a 10.13% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 37,310 shares of company stock valued at $17,256,219 over the last quarter. 0.03% of the stock is currently owned by company insiders.

Wall Street Analyst Weigh In

A number of brokerages have commented on MSFT. Wedbush reiterated an “outperform” rating and set a $575.00 price target on shares of Microsoft in a research report on Wednesday, May 13th. Sanford C. Bernstein set a $660.00 price target on shares of Microsoft in a research note on Monday, August 10th. Barclays lowered their price objective on shares of Microsoft from $545.00 to $512.00 and set an “overweight” rating for the company in a report on Thursday, July 30th. Cantor Fitzgerald upped their price objective on shares of Microsoft from $502.00 to $522.00 and gave the company an “overweight” rating in a research note on Monday, July 27th. Finally, CLSA reaffirmed an “outperform” rating on shares of Microsoft in a report on Thursday, July 30th. Forty-two equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. Based on data from MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus target price of $560.27.

Check Out Our Latest Analysis on Microsoft

Microsoft Price Performance
Shares of Microsoft stock opened at $495.40 on Friday. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. The business’s 50 day simple moving average is $411.27 and its two-hundred day simple moving average is $408.50. The stock has a market capitalization of $3.68 trillion, a P/E ratio of 27.58, a price-to-earnings-growth ratio of 1.60 and a beta of 1.11. Microsoft Corporation has a one year low of $349.20 and a one year high of $553.72.

Microsoft (NASDAQ:MSFT – Get Free Report) last announced its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. The firm had revenue of $90.01 billion during the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The business’s revenue was up 17.7% on a year-over-year basis. During the same quarter in the previous year, the company posted $3.65 earnings per share. Analysts forecast that Microsoft Corporation will post 19.59 EPS for the current year.

Microsoft Announces Dividend
The company also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be issued a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a yield of 0.7%. The ex-dividend date is Thursday, August 20th. Microsoft’s dividend payout ratio is currently 20.27%.

Key Stories Impacting Microsoft
Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Analysts continue to highlight Microsoft’s Azure expansion, accelerating Microsoft 365 Copilot adoption, and the company’s ability to sustain double-digit earnings growth. Microsoft’s latest quarter also exceeded expectations, with revenue of approximately $90 billion and earnings growth supported by Azure. Microsoft’s Cloud Gains Can Sustain Double-Digit Earnings Growth
Positive Sentiment: JPMorgan raised its Microsoft price target to $625, citing stronger Copilot demand and accelerating infrastructure investment. Other analysts remain bullish, with a six-month median target near $540, reinforcing investor confidence in Microsoft’s long-term AI positioning. JPMorgan Raises Microsoft Price Target
Positive Sentiment: Microsoft is combining its consumer and enterprise Copilot applications into a unified platform, potentially improving distribution, user engagement, and monetization as it competes with ChatGPT, Gemini, and Claude. Microsoft Unifies Copilot Applications
Neutral Sentiment: Microsoft approved the first AI data-center deployment under its $9.7 billion agreement with IREN, supporting Azure capacity expansion. The deal improves supply visibility but also underscores Microsoft’s substantial capital requirements. IREN Delivers First AI Cloud Deployment
Negative Sentiment: Investors remain concerned that Microsoft’s roughly $175 billion AI infrastructure spending plan could pressure free cash flow and cloud margins. A reported decline in cloud gross margin and higher data-center, chip, electricity, and labor costs raise questions about how much of the company’s large AI backlog will translate into profit. Microsoft’s AI Backlog and Profitability Concerns
Negative Sentiment: Reports that Microsoft has closed at least 15 China offices and joint ventures add geopolitical and operational uncertainty, although Azure reportedly provides a profitable reason to retain a limited China presence. Microsoft Retreats in China

About Microsoft
(Free Report)

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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It had been a difficult year for shareholders of Microsoft (MSFT -0.30%), who saw the stock grind lower throughout 2026. Then, fourth-quarter earnings (fiscal year 2026) happened, and shares shot up 18% in a week, a remarkable move for a stock worth over $3 trillion.

And just like that, Microsoft's stock is positive for the year. Months of anguish have fallen to the wayside. Perhaps the best news yet, it's not too late to buy the stock. Here's what you need to know.

Image source: The Motley Fool.

Microsoft's Azure and AI continue to roll on
The first question is naturally: why did Microsoft surge on Q4 earnings? Investors went into earnings laser-focused on Microsoft's AI progress and apparently came away impressed.

Revenue grew by 18% year over year to $90 billion for the quarter, and net income soared 31% versus the prior year. Azure is the primary engine driving this, with 43% growth and topping $100 billion in annual revenue for the first time.

Importantly, Microsoft's AI strategy is progressing.

CEO Satya Nadella noted that Microsoft 365 Copilot has surpassed 30 million paid seats, an encouraging sign that the company's infamous stickiness with enterprises is bearing fruit once again. Nadella also emphasized that AI demand continues to outpace supply, despite the ongoing investments into data centers and other infrastructure.

One of the world's best tech companies still trades at a reasonable price
Microsoft's hefty AI investments have been a legitimate concern, and the stock's slide has much to do with questions regarding whether the company can generate a sufficient return on all that spending.

Nadella has repositioned Microsoft as a more cost-effective AI provider, leaning harder into its own silicon and frontier models. This seems to be resonating with customers as the market raises concerns over how expensive some of these cutting-edge frontier models can be to wield at scale.

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495.40

Prior to earnings, Microsoft's stock was sitting there at roughly 19 times forward earnings estimates. That's a modest valuation for arguably the world's most prominent technology company. In that light, it's not a shock that a strong quarter sprung the stock.

Better yet, the stock is still very appealing for long-term investors at its current price. Shares now trade at a more expensive forward P/E ratio of 25. That said, analysts do expect Microsoft to grow earnings by an average of 15% to 16% annually over the next three to five years. It's hard to dismiss those estimates after net income just jumped 31% in the most recent quarter.

As long as Microsoft remains competitive in AI, and that seems like a safe bet thanks to Azure, the stock has a good shot at generating healthy returns from its current price over the next five years.

Amazon (AMZN -0.94%) and Microsoft (MSFT -0.30%) are two of the biggest names in artificial intelligence (AI). Both of these companies have taken a similar path, choosing to integrate AI into their own products but utilize other providers' models instead of creating their own. They each also have a thriving cloud computing business, benefiting from rising AI workloads.

But which one of these two makes for the better buy? Let's take a look at the fourth- and fifth-largest companies in the world, and see which makes the most sense for your investment dollars.

Image source: Getty Images.

Both companies have a wide-ranging business
Microsoft's business is quite broad, ranging from business productivity software to gaming hardware and software to cloud computing. Microsoft has an iron grip in many of the industries that it's in and a massive number of clients that cannot afford to cut Microsoft's software even if times get bad. This makes Microsoft a pretty safe business to invest in, as it will likely be OK regardless of economic conditions.

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Amazon is in a similar boat, as its commerce business has become the most popular online shopping destination, and it has countless devoted clients that utilize its services every day.

Both Microsoft and Amazon have rock-solid cloud computing businesses too that are thriving in the AI build-out, and each of them is spending hundreds of billions of dollars to increase capacity to meet demand.

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While each business has its ups and downs, nothing points to Microsoft's or Amazon's base business being better than the other. As a result, I'm scoring this category as a tie.

Winner: Tie.

Both companies are growing at a similar pace
From a revenue growth standpoint, Microsoft has long enjoyed a lead over Amazon, but that changed during the most recent quarter.

MSFT Revenue (Quarterly YoY Growth) data by YCharts.

This boost is primarily because Amazon's cloud computing division, Amazon Web Services (AWS), is starting to really accelerate its growth, posting a 37% pace in the third quarter after several years of delivering growth in the 20% or so range. Considering we've just seen the tip of the iceberg in AI spending and cloud computing growth due to that spending, I wouldn't be surprised if Amazon maintains that lead moving forward.

Another item where Amazon has the edge is operating profit growth. Each company has significant investments in private AI companies (Microsoft is heavily invested in OpenAI, and Amazon is invested in Anthropic), which skews earnings results. Instead, I'll use operating profit growth, which doesn't include these gains. Amazon's lead starts to really open up here, mainly because of cloud computing's higher-margin profile than its base commerce business.

MSFT Operating Income (Quarterly YoY Growth) data by YCharts

This cements Amazon's win in the growth category.

Winner: Amazon.

Microsoft is the cheaper stock by one measure
I'll value the stock using their operating profits for the same reason that I looked at operating income growth versus earnings-per-share growth.

MSFT Operating PE Ratio data by YCharts.

Microsoft stock is far cheaper from this perspective, but that makes sense considering Amazon's growth rate, which deserves a premium.

If we look at forward earnings projections, that filters out some of the growth associated with past gains from rising investments. From this perspective, Amazon actually looks cheaper.

MSFT PE Ratio (Forward) data by YCharts.

Amazon's superior profit growth rate keeps pushing it to the top, so I think it's pretty easy to declare Amazon the winner both in this category and overall.

Winner: Amazon.

Does that mean you need to go out and sell all of your Microsoft shares? Absolutely not. I think Microsoft is still a great investment with plenty of upside. However, with AWS set to grow much faster than it has in the past, Amazon looks like it has more upside in the near term.

One thing that stood out in Space Exploration Technologies' (SPCX -0.91%) first quarterly earnings report as a publicly traded company was just how much it's spending to build out new AI compute capacity. The company's AI-related capital expenditures doubled sequentially to $15.8 billion, and management said it expects to continue spending at a similar level through the end of the year.

To be sure, that capex spending is still dwarfed by what hyperscalers such as Amazon (AMZN -0.94%), Alphabet (GOOG -0.12%) (GOOGL -0.13%), and Microsoft (MSFT -0.30%) are laying out on data centers. Each of those three spent between $41 billion and $55 billion last quarter alone. But they're also generating huge amounts of revenue from their cloud computing units, with massive backlogs of contracted business.

However, SpaceX CEO Elon Musk believes his company can deploy capital much more efficiently than the hyperscalers can, thanks to a unique competitive advantage. 

SpaceX CEO Elon Musk. Image source: The White House.

What is SpaceX's advantage in artificial intelligence? Musk argues that SpaceX has an engineering advantage over everyone else competing in the cloud computing business. His premise is that it can deploy the engineering talent pool and intellectual property base that supported the development of its rocket operations to efficiently build new data centers that produce high returns on investment.

"We're finding that even a small amount of what we've learned building rockets, which are incredibly difficult, applied to data centers, yields tremendous benefits," Musk said on the company's first earnings call. He noted its cooling systems are well ahead of what's needed.

The payoff potential appears substantial.

"The current economics have translated into a less than one-year payback on our new capital deployments for compute," CFO Bret Johnsen said during his prepared remarks.

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That stands in stark contrast to comments from Amazon CEO Andy Jassy, who outlined the economics for Amazon Web Services' massive build-out.

"Data center capital is spent starting two years before we can put servers into them to start monetizing," he explained. That's just the physical limitations it's seeing in building new data centers; it can't even begin to monetize them for two years, let alone break even in one year.

"For servers and networking equipment, on average, it takes a little less than three years to break even on that investment," Jassy added. Even if the cost of a data center were zero, Jassy said it would take nearly three years to break even on the equipment it buys to equip those buildings. Results from Microsoft and Alphabet suggest similar timelines for their operations.

There's a huge gap in SpaceX's accounting and Amazon's accounting. Is SpaceX, a company that practically entered the cloud computing space yesterday, really so much more efficient at engineering and capital deployment that it can produce results three times better than those of the hyperscalers?

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Why investors should be skeptical of Musk's claims Musk has never shied away from making bold claims about where his businesses are headed, and when they will pass various milestones. More often than not, the results fall short of his predictions. There's reason to be skeptical about SpaceX's ability to establish a meaningful competitive advantage in AI compute based on its engineering talent alone.

While Johnsen's claim that it's producing very fast paybacks on its current investments may be accurate, it's not clear that it will be able to scale up as efficiently. SpaceX had existing infrastructure that it used to provide more compute capacity to third-party customers like Anthropic and Alphabet's Google last quarter. That's not necessarily repeatable.

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What's more, it simply doesn't make sense that SpaceX could easily retain such top talent in the face of competition from hyperscalers. As mentioned, Alphabet, Amazon, and Microsoft are spending three times as much on capital expenditures as SpaceX. Their businesses are heavily reliant on efficient returns on that capital spending. They would surely pay up for top talent if it meant improving their return on capital severalfold.

SpaceX is merely in a position to provide some AI compute at a time when there's a severe shortage of it. Alphabet has signed a contract with the company for compute because the long-term potential of serving large customers like Anthropic now with its own infrastructure by offloading some of its internal AI compute needs to a third party is too good to pass up.

Alphabet can end its contract with SpaceX as soon as it builds enough capacity for itself. That could result in some excellent short-term revenues for SpaceX, but it doesn't indicate a long-term competitive advantage in cloud computing.

Microsoft remains a “Buy,” driven by robust earnings, cloud growth, and a 21-year dividend growth streak. MSFT's Q4 FY 2026 revenue surged 17.7% to $90.01 billion, with cloud revenue up 31.6% and commercial backlog soaring 84%. Trading at a 12% discount to a $558 fair value estimate, MSFT offers a potential 21% total return by 2027 and 16% annualized through 2032.

Joho Capital's Founder Trims Tech Exposure While Boosting Industrial and Consumer StakesRobert Karr (Trades, Portfolio), the founder of Joho Capital and a promi

New PositionsPershing Square unveiled several new positions in the second quarter, which ended June 30, 2026. Here’s a look at the changes to the portfolio compared to first quarter.

Exited PositionsIn the second quarter, Pershing Square exited positions in the following stocks:

Alphabet Class C (NASDAQ:GOOG)

Alphabet Class A (NASDAQ:GOOGL)
Portfolio ChangesThe second-quarter 13F showed changes in the existing stocks held by Pershing Square. Here are the top decreases in stakes by Pershing Square in the second quarter, by percentage.

Here are the top additions in the second quarter by percentage:

Top HoldingsAt the end of the second quarter, these were the largest stock holdings in the Pershing Square portfolio and their valuation at the time:

Uber: $2.48 billion
Brookfield: $2.45 billion
Microsoft: $2.32 billion
Amazon: $2.04 billion
Howard Hughes: $1.99 billion
Restaurant Brands: $1.87 billion
Meta Platforms: $1.80 billion
Visa: $1.12 billion
Mastercard: $1.09 billion
S&P Global: $1.06 billion
Netflix: $934 million
New stakes in Visa, Mastercard and S&P Global all landed in the top 10 to end the quarter. Ackman’s Magnificent Seven exposure went in two directions: he added to Microsoft and Meta, both top-10 holdings, while cutting Amazon and exiting Alphabet’s Class A and Class C shares outright. Amazon is still a top-five position.

Photo courtesy: T. Schneider / Shutterstock.com

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Arkadios Wealth Advisors increased its holdings in Microsoft Corporation (NASDAQ: MSFT) by 11.7% in the first quarter, according to its most recent disclosure with the Securities and Exchange Commission. The institutional investor owned 237,463 shares of the software giant's stock after buying an additional 24,778 shares during the period. Microsoft comprises approximately 1.4%

Alphabet (GOOG +0.46%) (GOOGL +0.82%) and Microsoft (MSFT +0.90%) are two of the biggest tech giants on the market, and the third and fourth-largest companies in the world. Each has posted terrific results in its most recent quarter, but which one is doing better?

Let's take a look at which one of these stocks makes the most sense for your investment dollars, or if they're both worth buying now.

Image source: Getty Images.

The businesses are similar Microsoft has built a software empire used by businesses and consumers around the globe. Microsoft also has a growing artificial intelligence business with its Copilot application, which allows companies to input internal data without fear of it leaking into the outside world.

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Alphabet's business is more advertising-focused, with the Google Search engine headlining its primary business. Advertising has been strong lately, but it tends to decline during times of economic uncertainty. Overall, Microsoft's software business is more stable, but Alphabet's business can grow faster during the good times.

Both also have a cloud computing business unit, which gives each massive exposure to rising AI computing needs. This is also the primary reason why each is spending hundreds of billions of dollars on data centers, and the payoff is starting to show up for those major investments.

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I think you're splitting hairs as to which company has the better business model. As a result, I'm giving this category a tie.

Winner: Tie

Alphabet is growing faster From a growth standpoint, Alphabet has the edge. In the second quarter, Alphabet's revenue increased by 24% year over year, headlined by its booming Google Cloud division, which saw 82% revenue growth. Microsoft posted an admirable 18% revenue growth, with Azure (its cloud computing division) seeing 43% growth.

Comparing earnings-per-share growth isn't easy, as Alphabet reported a huge gain thanks to its long-term investment in Space Exploration Technologies (SpaceX). As a result, the better metric to look at here is operating income growth. During the quarter, Alphabet's operating income rose 30%, while Microsoft's increased by 18%.

With Alphabet winning on profit and revenue growth, it's impossible to declare Microsoft the winner.

Winner: Alphabet

Valuing these stocks isn't easy Thanks to Alphabet's SpaceX investment gains, its price-to-earnings ratio is a poor measure for valuing the company. Additionally, both are spending a ton of money on data center build-outs, so free cash flow is also a bad metric to use.

Instead, I think using operating profits is a smarter way to value these two. For the better part of the past three years, Microsoft has always maintained a premium over Alphabet. That flip-flopped late last year, and now Alphabet is the more expensive stock.

GOOG Operating PE Ratio data by YCharts

As Microsoft is slightly cheaper, I think it takes the cake here, as Alphabet is still trading at an elevated valuation, even if it deserves it.

Winner: Microsoft

Which is the better stock to buy? With the analysis ending in a tie, it would be easy to declare both stocks winners. But that's no fun. Which stock do I think is the best? I think it's clearly Alphabet.

While it may be more expensive, its cloud computing division is growing far faster than Microsoft's. Furthermore, its growth rate is accelerating rapidly, while Microsoft's has only increased slightly in the quarter. For reference, Azure's growth rate went from 40% in Q3 to 43% in Q4 in fiscal year 2026. Google Cloud went from 34% in Q3 2025 to 48% in Q4 2025, then to 63% in Q1 2026, and to 82% in Q2 2026.

There's clearly something special about Google Cloud compared to Azure, and with it becoming a major part of Alphabet's business, I think it will deliver superior stock performance relative to Microsoft over the next five years.

Encore Global Management LP purchased a new position in Microsoft Corporation (NASDAQ:MSFT – Free Report) during the first quarter, according to its most recent Form 13F filing with the SEC. The fund purchased 12,950 shares of the software giant’s stock, valued at approximately $4,794,000. Microsoft makes up about 3.3% of Encore Global Management LP’s investment portfolio, making the stock its 3rd largest holding.

A number of other institutional investors have also added to or reduced their stakes in the stock. Markel Group Inc. lifted its holdings in shares of Microsoft by 0.4% in the 1st quarter. Markel Group Inc. now owns 537,630 shares of the software giant’s stock valued at $199,014,000 after acquiring an additional 1,950 shares during the last quarter. Bessemer Group Inc. increased its stake in Microsoft by 8.4% during the first quarter. Bessemer Group Inc. now owns 6,921,677 shares of the software giant’s stock worth $2,562,197,000 after acquiring an additional 537,634 shares during the last quarter. Taylor Securities Services Inc. purchased a new stake in Microsoft during the fourth quarter valued at approximately $2,616,000. Werba Rubin Papier Wealth Management raised its position in Microsoft by 15.7% during the fourth quarter. Werba Rubin Papier Wealth Management now owns 12,492 shares of the software giant’s stock valued at $6,041,000 after purchasing an additional 1,698 shares during the period. Finally, Harel Insurance Investments & Financial Services Ltd. lifted its stake in shares of Microsoft by 138.8% in the 1st quarter. Harel Insurance Investments & Financial Services Ltd. now owns 1,356,359 shares of the software giant’s stock valued at $502,077,000 after purchasing an additional 788,297 shares during the last quarter. 71.13% of the stock is owned by hedge funds and other institutional investors.

Key Microsoft News Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Pershing Square’s Bill Ackman reaffirmed his bullish Azure thesis, arguing that continued capacity investment and Microsoft 365’s embedded customer base can support high-teens earnings growth. Microsoft Stock Rises as Ackman Reaffirms Azure Bet Positive Sentiment: JPMorgan raised its Microsoft price target to $625, citing accelerating Copilot adoption and infrastructure growth. Wells Fargo also maintained an overweight rating and lifted its target to $700, reinforcing the view that the stock’s AI-driven recovery has further upside. JPMorgan Raises Microsoft Price Target Positive Sentiment: Microsoft began gradually combining its consumer and enterprise Copilot applications into a unified AI platform. The planned “super app” could improve user adoption, cross-selling and Microsoft’s competitive position against ChatGPT, Gemini and Claude. Microsoft Unifies Consumer and Enterprise Copilot Positive Sentiment: Microsoft accepted IREN’s first AI data-center deployment under a $9.7 billion cloud agreement. The milestone supports Azure’s ability to secure additional computing capacity as AI infrastructure demand remains strong. IREN Hands Microsoft Its First AI Cloud Deployment Neutral Sentiment: Microsoft is reportedly closing or restructuring numerous China offices and joint ventures, while retaining an Azure-linked presence. The move may reduce geopolitical exposure but could also limit access to the Chinese market. Microsoft Retreats in China Negative Sentiment: A report said Microsoft plans to cut carbon-removal purchases while AI-related emissions rise, creating potential reputational and environmental concerns. Microsoft Carbon Removal Purchases Report Insider Buying and Selling In related news, EVP Takeshi Numoto sold 4,810 shares of the business’s stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the completion of the transaction, the executive vice president owned 42,677 shares in the company, valued at $21,188,276.96. The trade was a 10.13% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. Also, CEO Judson Althoff sold 15,500 shares of the stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $460.99, for a total transaction of $7,145,345.00. Following the sale, the chief executive officer directly owned 110,477 shares of the company’s stock, valued at $50,928,792.23. The trade was a 12.30% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders sold 37,310 shares of company stock worth $17,256,219. Insiders own 0.03% of the company’s stock.

Analyst Upgrades and Downgrades Several equities analysts have recently weighed in on MSFT shares. HSBC cut their target price on Microsoft from $593.00 to $571.00 in a research report on Thursday, April 30th. Arete Research lifted their price objective on shares of Microsoft from $730.00 to $870.00 and gave the stock a “buy” rating in a research note on Tuesday, May 5th. Royal Bank Of Canada reiterated an “outperform” rating and set a $640.00 price objective on shares of Microsoft in a research report on Thursday, July 30th. Morgan Stanley reissued an “overweight” rating on shares of Microsoft in a research note on Thursday, July 30th. Finally, DZ Bank restated a “buy” rating on shares of Microsoft in a report on Thursday, April 30th. Forty-two equities research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company. Based on data from MarketBeat, Microsoft presently has an average rating of “Moderate Buy” and a consensus price target of $560.27.

Get Our Latest Analysis on MSFT

Microsoft Trading Up 0.9% MSFT opened at $496.88 on Friday. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07. The firm has a market cap of $3.69 trillion, a price-to-earnings ratio of 27.67, a PEG ratio of 1.59 and a beta of 1.11. Microsoft Corporation has a 12 month low of $349.20 and a 12 month high of $553.72. The stock has a fifty day moving average price of $409.70 and a 200-day moving average price of $407.88.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating analysts’ consensus estimates of $4.24 by $0.50. The company had revenue of $90.01 billion for the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The firm’s revenue for the quarter was up 17.7% compared to the same quarter last year. During the same quarter last year, the company earned $3.65 earnings per share. As a group, equities research analysts anticipate that Microsoft Corporation will post 19.58 earnings per share for the current fiscal year.

Microsoft Announces Dividend The company 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 $0.91 dividend. The ex-dividend date of this dividend is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.7%. Microsoft’s payout ratio is presently 20.27%.

Microsoft Profile (Free Report)

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).

Read More Five stocks we like better than Microsoft Asian Market Circuit Breakers Hit Stocks, Not AI Demand Riot Platforms Re-Wires the Ledger for a $9B AI Power Play Nebius Just Exploded 34% on Blowout Earnings—Is It Time to Buy? Joby’s Defense Pivot Accelerates With $500M Resonant Sciences Deal Want to see what other hedge funds are holding MSFT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Microsoft Corporation (NASDAQ:MSFT – Free Report).

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Adalta Capital Management LLC trimmed its holdings in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 12.7% in the first quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 39,474 shares of the software giant’s stock after selling 5,754 shares during the quarter. Microsoft comprises 7.0% of Adalta Capital Management LLC’s portfolio, making the stock its largest holding. Adalta Capital Management LLC’s holdings in Microsoft were worth $14,612,000 as of its most recent SEC filing.

Several other institutional investors and hedge funds also recently modified their holdings of the business. Vanguard Group Inc. grew its stake in shares of Microsoft by 2.3% in the 4th quarter. Vanguard Group Inc. now owns 717,942,580 shares of the software giant’s stock worth $347,211,391,000 after purchasing an additional 15,955,898 shares during the last quarter. State Street Corp raised its position in Microsoft by 2.1% during the fourth quarter. State Street Corp now owns 306,150,608 shares of the software giant’s stock valued at $148,060,557,000 after acquiring an additional 6,388,930 shares in the last quarter. Geode Capital Management LLC raised its holdings in shares of Microsoft by 1.1% during the 4th quarter. Geode Capital Management LLC now owns 182,618,400 shares of the software giant’s stock valued at $88,056,019,000 after purchasing an additional 1,911,142 shares in the last quarter. Morgan Stanley raised its holdings in shares of Microsoft by 0.8% during the 4th quarter. Morgan Stanley now owns 121,220,561 shares of the software giant’s stock valued at $58,624,690,000 after purchasing an additional 980,439 shares in the last quarter. Finally, Norges Bank acquired a new stake in shares of Microsoft in the 4th quarter valued at $50,664,631,000. Institutional investors own 71.13% of the company’s stock.

Insider Transactions at Microsoft In other news, CEO Judson Althoff sold 15,500 shares of Microsoft stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $460.99, for a total transaction of $7,145,345.00. Following the completion of the sale, the chief executive officer owned 110,477 shares in the company, valued at $50,928,792.23. The trade was a 12.30% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, EVP Takeshi Numoto sold 4,810 shares of the firm’s stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the transaction, the executive vice president owned 42,677 shares in the company, valued at $21,188,276.96. This represents a 10.13% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 37,310 shares of company stock valued at $17,256,219 over the last ninety days. 0.03% of the stock is currently owned by company insiders.

Key Microsoft News Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Pershing Square’s Bill Ackman reaffirmed his bullish Azure thesis, arguing that continued capacity investment and Microsoft 365’s embedded customer base can support high-teens earnings growth. Microsoft Stock Rises as Ackman Reaffirms Azure Bet Positive Sentiment: JPMorgan raised its Microsoft price target to $625, citing accelerating Copilot adoption and infrastructure growth. Wells Fargo also maintained an overweight rating and lifted its target to $700, reinforcing the view that the stock’s AI-driven recovery has further upside. JPMorgan Raises Microsoft Price Target Positive Sentiment: Microsoft began gradually combining its consumer and enterprise Copilot applications into a unified AI platform. The planned “super app” could improve user adoption, cross-selling and Microsoft’s competitive position against ChatGPT, Gemini and Claude. Microsoft Unifies Consumer and Enterprise Copilot Positive Sentiment: Microsoft accepted IREN’s first AI data-center deployment under a $9.7 billion cloud agreement. The milestone supports Azure’s ability to secure additional computing capacity as AI infrastructure demand remains strong. IREN Hands Microsoft Its First AI Cloud Deployment Neutral Sentiment: Microsoft is reportedly closing or restructuring numerous China offices and joint ventures, while retaining an Azure-linked presence. The move may reduce geopolitical exposure but could also limit access to the Chinese market. Microsoft Retreats in China Negative Sentiment: A report said Microsoft plans to cut carbon-removal purchases while AI-related emissions rise, creating potential reputational and environmental concerns. Microsoft Carbon Removal Purchases Report Analyst Upgrades and Downgrades MSFT has been the subject of a number of recent analyst reports. Barclays decreased their target price on Microsoft from $545.00 to $512.00 and set an “overweight” rating for the company in a research report on Thursday, July 30th. DZ Bank reiterated a “buy” rating on shares of Microsoft in a report on Thursday, April 30th. BMO Capital Markets raised their price target on Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a research report on Thursday, July 30th. BNP Paribas Exane dropped their price objective on Microsoft from $556.00 to $555.00 and set an “outperform” rating on the stock in a research note on Friday, May 1st. Finally, Piper Sandler boosted their price objective on Microsoft from $540.00 to $550.00 and gave the stock an “overweight” rating in a research report on Tuesday, July 28th. Forty-two analysts have rated the stock with a Buy rating and five have given a Hold rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $560.27.

Get Our Latest Stock Analysis on Microsoft

Microsoft Stock Performance NASDAQ:MSFT opened at $496.88 on Friday. The firm has a 50-day moving average price of $409.70 and a 200 day moving average price of $407.88. The company has a quick ratio of 1.22, a current ratio of 1.23 and a debt-to-equity ratio of 0.07. The firm has a market capitalization of $3.69 trillion, a PE ratio of 27.67, a price-to-earnings-growth ratio of 1.59 and a beta of 1.11. Microsoft Corporation has a 12-month low of $349.20 and a 12-month high of $553.72.

Microsoft (NASDAQ:MSFT – Get Free Report) last posted its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, topping the consensus estimate of $4.24 by $0.50. The company had revenue of $90.01 billion during the quarter, compared to analyst estimates of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The company’s revenue was up 17.7% on a year-over-year basis. During the same quarter last year, the business posted $3.65 earnings per share. Research analysts anticipate that Microsoft Corporation will post 19.58 earnings per share for the current fiscal year.

Microsoft Dividend Announcement The firm also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be issued a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.7%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s payout ratio is currently 20.27%.

Microsoft Company Profile (Free Report)

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).

Further Reading Five stocks we like better than Microsoft Asian Market Circuit Breakers Hit Stocks, Not AI Demand Riot Platforms Re-Wires the Ledger for a $9B AI Power Play Nebius Just Exploded 34% on Blowout Earnings—Is It Time to Buy? Joby’s Defense Pivot Accelerates With $500M Resonant Sciences Deal

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EverSource Wealth Advisors LLC grew its stake in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 38.0% during the 1st quarter, according to the company in its most recent 13F filing with the SEC. The institutional investor owned 95,488 shares of the software giant’s stock after buying an additional 26,285 shares during the quarter. Microsoft accounts for 1.1% of EverSource Wealth Advisors LLC’s investment portfolio, making the stock its 14th biggest position. EverSource Wealth Advisors LLC’s holdings in Microsoft were worth $35,347,000 as of its most recent filing with the SEC.

A number of other hedge funds also recently made changes to their positions in MSFT. Norges Bank bought a new position in shares of Microsoft during the 4th quarter valued at about $50,664,631,000. Auto Owners Insurance Co lifted its position in Microsoft by 56,160.8% in the 4th quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant’s stock worth $29,073,486,000 after buying an additional 60,009,531 shares during the last quarter. Nuveen LLC bought a new stake in Microsoft in the 1st quarter worth approximately $18,733,827,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its stake in Microsoft by 500.0% in the third quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 59,543,261 shares of the software giant’s stock worth $30,840,432,000 after buying an additional 49,618,571 shares in the last quarter. Finally, Laurel Wealth Advisors LLC grew its position in Microsoft by 49,640.3% during the second quarter. Laurel Wealth Advisors LLC now owns 29,967,038 shares of the software giant’s stock valued at $14,905,904,000 after acquiring an additional 29,906,791 shares during the last quarter. 71.13% of the stock is owned by institutional investors.

Microsoft Price Performance
Shares of Microsoft stock opened at $496.88 on Friday. The company’s fifty day simple moving average is $409.70 and its two-hundred day simple moving average is $407.88. Microsoft Corporation has a 12-month low of $349.20 and a 12-month high of $553.72. The firm has a market cap of $3.69 trillion, a PE ratio of 27.67, a price-to-earnings-growth ratio of 1.59 and a beta of 1.11. The company has a quick ratio of 1.22, a current ratio of 1.23 and a debt-to-equity ratio of 0.07.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 EPS for the quarter, beating the consensus estimate of $4.24 by $0.50. The firm had revenue of $90.01 billion during the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The company’s quarterly revenue was up 17.7% compared to the same quarter last year. During the same period in the prior year, the firm posted $3.65 earnings per share. As a group, equities analysts expect that Microsoft Corporation will post 19.58 EPS for the current year.

Microsoft Announces Dividend
The firm also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be given a dividend of $0.91 per share. The ex-dividend date of this dividend is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a yield of 0.7%. Microsoft’s dividend payout ratio is presently 20.27%.

Insider Buying and Selling
In other Microsoft news, EVP Takeshi Numoto sold 4,810 shares of the stock in a transaction that occurred on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the sale, the executive vice president owned 42,677 shares in the company, valued at approximately $21,188,276.96. This trade represents a 10.13% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CEO Judson Althoff sold 15,500 shares of Microsoft stock in a transaction that occurred on Monday, June 1st. The stock was sold at an average price of $460.99, for a total value of $7,145,345.00. Following the completion of the sale, the chief executive officer owned 110,477 shares in the company, valued at approximately $50,928,792.23. This represents a 12.30% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 37,310 shares of company stock valued at $17,256,219 in the last ninety days. 0.03% of the stock is currently owned by corporate insiders.

Wall Street Analysts Forecast Growth
A number of equities research analysts have recently weighed in on the stock. Tigress Financial boosted their price objective on shares of Microsoft from $680.00 to $690.00 and gave the stock a “buy” rating in a report on Wednesday, August 5th. Jefferies Financial Group reiterated a “buy” rating on shares of Microsoft in a research report on Monday, May 4th. Royal Bank Of Canada reissued an “outperform” rating and issued a $640.00 price target on shares of Microsoft in a research note on Thursday, July 30th. UBS Group set a $525.00 price objective on Microsoft in a research note on Thursday, July 30th. Finally, Raymond James Financial lowered Microsoft from a “market perform” rating to a “market perform” rating in a research note on Tuesday, May 5th. Forty-two analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company’s stock. According to MarketBeat, Microsoft currently has a consensus rating of “Moderate Buy” and a consensus price target of $560.27.

View Our Latest Analysis on Microsoft

Trending Headlines about Microsoft
Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Pershing Square’s Bill Ackman reaffirmed his bullish Azure thesis, arguing that continued capacity investment and Microsoft 365’s embedded customer base can support high-teens earnings growth. Microsoft Stock Rises as Ackman Reaffirms Azure Bet
Positive Sentiment: JPMorgan raised its Microsoft price target to $625, citing accelerating Copilot adoption and infrastructure growth. Wells Fargo also maintained an overweight rating and lifted its target to $700, reinforcing the view that the stock’s AI-driven recovery has further upside. JPMorgan Raises Microsoft Price Target
Positive Sentiment: Microsoft began gradually combining its consumer and enterprise Copilot applications into a unified AI platform. The planned “super app” could improve user adoption, cross-selling and Microsoft’s competitive position against ChatGPT, Gemini and Claude. Microsoft Unifies Consumer and Enterprise Copilot
Positive Sentiment: Microsoft accepted IREN’s first AI data-center deployment under a $9.7 billion cloud agreement. The milestone supports Azure’s ability to secure additional computing capacity as AI infrastructure demand remains strong. IREN Hands Microsoft Its First AI Cloud Deployment
Neutral Sentiment: Microsoft is reportedly closing or restructuring numerous China offices and joint ventures, while retaining an Azure-linked presence. The move may reduce geopolitical exposure but could also limit access to the Chinese market. Microsoft Retreats in China
Negative Sentiment: A report said Microsoft plans to cut carbon-removal purchases while AI-related emissions rise, creating potential reputational and environmental concerns. Microsoft Carbon Removal Purchases Report

Microsoft Company Profile
(Free Report)

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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