Analysts Expect Microsoft's Cloud Momentum to Continue in Q1

what happened

According to Seeking Alpha, Microsoft will publish its quarterly results on Wednesday, and Wall Street expects revenue to rise almost 17% to $90.74 billion, with earnings per share of $4.72, up 14%. Cloud business and rising demand for artificial intelligence services are seen as the main drivers. The stock has gained more than 36% since the company's second-quarter report.

Morgan Stanley says Microsoft needs Azure growth in the mid-40s percent range, better monetization of Microsoft 365 and Copilot, and disciplined operating expenses to keep the momentum. TD Cowen sees potential for a larger-than-usual beat on Azure. Still, investors are growing more skeptical of the heavy AI spending by big technology companies and want tangible returns.

Starting with the first quarter, Microsoft will report under a new structure with two segments: Agents and Infra, and Devices and Consumer.

why it matters

The report matters for the broader US market because Microsoft is one of the largest companies in the S&P 500. Investors will watch Azure growth and free cash flow resilience alongside rising AI capital spending, which has recently weighed on technology stocks.

market impact

Microsoft shares and the S&P 500: results will show whether cloud and AI expectations are met

• ↔Акции Microsoft mixed — результаты покажут, оправдаются ли ожидания по облаку и ИИ, при уже заметном росте бумаг за последние месяцы
• ↔S&P 500 mixed — Microsoft входит в число крупнейших компаний индекса, и её отчёт повлияет на настроения на рынке технологических акций

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