Microsoft FY26 Q4: Azure’s $100B year and the CapEx receipt
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On July 29, 2026 Microsoft reported fiscal FY26 Q4 (quarter ended June 30) — same calendar window as Meta/SoFi’s Q2, different fiscal label. Do not call this “Microsoft Q2.”Primary: FY26 Q4 press release · Exhibit 99.1 (SEC) · earnings call.
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The print answers the question investors had been asking all year: is Azure demand still scarce capacity, or just narrative? Company numbers say demand is real. The open debate is what multiple you pay while CapEx stays this high.
Headline print
| Metric | FY26 Q4 | YoY |
|---|---|---|
| Revenue | $90.0B | +18% (+17% CC) |
| Operating income | $40.6B | +18% |
| GAAP net income | $35.8B | +31% |
| GAAP diluted EPS | $4.81 | +32% |
| Non-GAAP net income | $35.3B | +22% |
| Non-GAAP diluted EPS | $4.74 | +23% |
| Microsoft Cloud | $59.3B | +27% |
| Commercial RPO | $678B | +84% |
| Intelligent Cloud | $39.3B | +32% (+31% CC) |
| Azure and other cloud services | — | +43% |
Company also disclosed discrete items that benefited GAAP EPS by about $0.27 vs prior guidance, including a $3.2B gain on the Anthropic investment (partially offset by Xbox severance/impairment noise). Use non-GAAP and segment operating income for the operating story.Anthropic gain / discrete EPS items: company press release; CapEx year framing also in The Next Web.
Full year FY26: revenue $331.8B (+18%); operating income $155.2B (+21%); GAAP diluted EPS $17.95 (+32%). Azure revenue surpassed $100B for the first time (+41% for the year, per company commentary). Microsoft 365 Copilot reached over 30 million paid seats.Azure $100B year + Copilot seats narrative: TechTimes (secondary), cross-check company release.
YoY. Total revenue +18%; Microsoft Cloud +27%; Azure and other cloud services +43%; commercial RPO +84%.
JustHold · company filings
Call / segment color
- Productivity and Business Processes revenue $37.8B (+14%); More Personal Computing $12.9B (−4% / −5% CC)
- Windows OEM and Devices −7%; Xbox content and services −10%; Search ads ex-TAC +10%
- On the call, Amy Hood guided ~45% Azure growth (constant currency) for the next quarter — above many Street prints clustered nearer the low-40s
- Company: customer demand continues to exceed available capacity; additional in-quarter Azure capacity was quickly monetized
- Returned $10.2B to shareholders in Q4 via dividends and buybacks
Bull case
- Azure re-accelerated (+43% vs ~+40% prior quarter in secondary timelines)
- RPO surge and “non-frontier” customer commentary reduce “only big model labs” skepticism
- Copilot paid seats answered the late-July adoption worry
Bear case
- CapEx intensity remains enormous (secondary reports cite ~$35.8B quarterly CapEx and ~$116B for the year — verify against full cash-flow tables if you size the stock)
- Gaming / devices soft on the consumer side
- GAAP optics partly helped by investment gains
JustHold take
This is the cleaner “AI demand is real” mega-cap print of the day. The debate shifts from is Azure slowing? to what multiple do you pay when CapEx stays this high? Watch next quarter’s Azure guide and CapEx commentary more than the EPS print itself.
Not investment advice.