Microsoft's Dividend Increase to Hit 17 Consecutive Years

Microsoft's dividend growth has been a steady trend for over a decade. The company has increased its quarterly dividend every year since 2015, and it typically announces this increase in September.

The past six annual increases have fallen within a narrow band of 9.6% to 10.7%. Applying this range to the current payment of $0.91 per share, analysts expect an increase to around $1.00 per quarter, or $4.00 per year, which would be approximately a 10% hike.

However, Microsoft's recent capital expenditures have raised some concerns. The company allocated $115.9 billion to property and equipment in fiscal 2026, a significant jump from the previous year, mainly due to its artificial intelligence (AI) data center capacity expansion. This increased spending might squeeze the company's free cash flow.

Despite this, Microsoft's earnings are growing faster than its dividend payment. Fiscal 2026 revenue rose by 18%, and Azure revenue crossed $100 billion for the year with a 41% increase. The company's net income of $133.7 billion was also 31% higher than in the previous year.