Microsoft Dominates Meta with Strong Earnings and Massive Contracted Backlog

Microsoft and Meta Platforms reported their earnings on July 29, 2026. The results were vastly different for the two tech giants. Microsoft's Intelligent Cloud business drove $39.31 billion in revenue at a growth rate of 32%, with Azure growing 43% and crossing the $100 billion mark in full-year revenue for the first time.

Azure secured $678B in contracted backlog, giving investors visibility into future revenue. Copilot passed 30 million paid seats, and Satya Nadella said customers are turning 'tokens into business results.' Commercial remaining performance obligations jumped 84% to $678 billion of contracted future revenue.

Meta Platforms reported $60.80 billion in revenue, up 27.96%, with ad impressions up 14% and price per ad up 12%. However, the company missed its earnings per share estimate of $7.2173 and saw operating margin compressed to 31% from 43%.

A $2.40 billion legal charge and $1.18 billion in severance from an 8,000-employee reduction contributed to Meta's free cash flow collapse to $784 million from $8.55 billion.