Joseph Carlson After Hours on $MSFT (Oct 29, 2026)
Microsoft's report was another strong one: revenue up 19%, operating income up 21%, margin up slightly to 50%, and cloud revenue of $63 billion, up 30% year over year and 31% in constant currency — incredible at its size. Free cash flow is expected to stay positive through fiscal 2027, with capex below expectations and self-funded, a conservatism investors like; its 1.2% drop is partly Google dragging the market, not the results.
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Now, we also have Microsoft, which announced its earnings,
Microsoft also announced its results. Its stock rose slightly at first. Now it has dropped by 1.2%, partly due to Google . Frankly, Google is dragging a lot of the market down today.
Therefore, part of the reason for the decline in the S&P 500 and Nasdaq indices is simply due to the Google report. But I look at Microsoft, and I see that it's another strong report.
Microsoft's revenue grew by 19%, operating income rose by 21% , and the operating margin increased slightly to 50% . These are excellent figures for Microsoft. Microsoft's cloud revenues reached $63 billion, a 30% year-over-year increase, and 31% in constant currency terms.
So, they are still growing in the cloud space by more than 30 %, which is incredible considering their size.
One important thing about Microsoft is that its free cash flow is expected to remain positive throughout fiscal year 2027. Essentially, they will continue to maintain positive free cash flow throughout the year.
They are funding their expansion in capital spending with their own money, and the capital spending has come in lower than expected. Therefore, Microsoft is taking a slightly more conservative approach to its capital expenditures. Investors usually like that .
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