Microsoft Earnings Preview: Azure Growth and FY2027 Capex in Focus
Microsoft's Q4 FY2026 earnings are scheduled for July 29, after close. The company is expected to report revenue of $87.67 billion, a 15% increase from last year. Azure growth will be a crucial metric, with guidance at 39-40% constant currency growth in Q4, matching the 40% beat in Q3.
The most significant new data point is FY2027 capex guidance of $255 billion to $260 billion, significantly higher than the $190 billion already committed in 2026. This has raised concerns about whether this spending is generating revenue or outpacing monetization, according to Moody's.
Microsoft's AI annual revenue run-rate has grown 123% year-over-year to $37 billion, driven by Azure AI workloads and enterprise AI applications. The company's Cloud revenue reached $54.5 billion in Q3, a 29% increase from last year.