Microsoft Stock Hinges on Q4 Results Amid CapEx Uncertainty
Microsoft's Q4 results are expected to show revenue and adjusted EPS growth of 15% each, but investors will be closely watching capital expenditures (CapEx) as Alphabet raised its 2026 CapEx forecast. Analysts believe cloud peers Amazon and Microsoft could follow suit.
Alphabet's move makes it more likely that Amazon and Microsoft will increase their spending, with Evercore ISI's Mark Mahaney saying 'increases the odds of similar behavior'. Shares of Amazon, Meta, and Microsoft tumbled last week after Alphabet's CapEx forecast hike, even as Google reported accelerating cloud growth.
Microsoft's Azure growth is also expected to be a key metric, following Google Cloud sales increasing 82% last quarter. Revenue from Microsoft's Azure grew 40% in the company's fiscal third quarter.