Microsoft reports Q4 revenue of $90.0 billion and guides FY27 capex to $175 billion, driving shares higher.
Microsoft shares jumped 7% after hours following stronger-than-expected Q4 results and a bullish capex outlook. Adjusted EPS of $4.74 beat estimates of $4.24, while revenue reached $90.0 billion, surpassing the $87.6 billion forecast. Full-year profit rose 31% to $133.7 billion, though results included a $0.27 EPS benefit from a $3.2 billion gain on an Anthropic investment and lower retirement costs.
Azure and other cloud services grew 43% in Q4, with Q1 guidance pointing to roughly 45% growth in constant currency. Total cloud revenue for the fiscal year exceeded $214 billion, with Azure alone crossing $100 billion. The company also reported a 25% rise in contract backlog, excluding OpenAI, and addressed concerns about reliance on frontier model companies by noting nearly 90% of cloud revenue comes from other customers.
The stock’s late surge was driven by capex guidance, with Microsoft projecting $175 billion in spending for calendar 2026 and FY27. The CFO clarified the figure reflects a lease accounting reclassification, not an increase in planned outlays. Q1 capex is expected to exceed $50 billion.