| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 25 | 27.8x | 18.2x | Bottom tier | |
Growth | 78 | 17.8% | 7.1% | Top tier | |
Quality | 85 | 27.0% | 4.5% | Top tier | |
Safety | 88 | — | 2.6x | Top tier | |
Capital Return | 37 | 0.73% | 2.10% | Bottom tier | |
Momentum | 73 | -1.6% | 2.9% | Top tier | |
Sentiment | 42 | 30 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Microsoft Corporation sells software, cloud services, productivity, security, development, and personal computing tools. In fiscal Q4 2026, the Intelligent Cloud segment generated $39.3 billion in revenue, while Productivity and Business Processes generated approximately $37.8 billion, and More Personal Computing recorded approximately $12.9 billion. Monetization drivers include Azure, Microsoft 365, Copilot, GitHub, Dynamics 365, LinkedIn, Windows, Xbox, and advertising in Bing and Edge, with AI products increasingly shifting from seat-only pricing to a model combining seat-based and consumption-based pricing.
Microsoft's fiscal 2026 revenue reached approximately $331.8 billion, gross profit was $225.5 billion, net income was $133.7 billion, and earnings per share were $17.95. According to the earnings call, annual revenue grew 18%, Microsoft Cloud revenue exceeded $214 billion with growth of 27%, while Azure revenue exceeded $100 billion with growth of 41%. Annual operating income rose 21% to more than $155 billion, outpacing revenue growth.
In fiscal Q4 2026, revenue was $90.0 billion, gross profit was $60.5 billion, and net income was $35.8 billion, equivalent to a gross margin of approximately 67.2% and a net margin of approximately 39.8%. Intelligent Cloud represented approximately 43.7% of quarterly revenue, Productivity and Business Processes approximately 42.0%, and More Personal Computing approximately 14.3%. Quarterly revenue rose 18%, while the operating margin reached 45%, operating cash flow was $55.4 billion, and free cash flow was $19.6 billion after capital expenditures of $41 billion.
The analyst consensus is "Buy," with an average price target of $547.74 and a wide range of $400 to $690; the average is near the upper end of the 52-week range of $349.20–$553.72, while the highest target clearly exceeds that level. The price-to-earnings multiple of 25.1 times cited in the context of the July 30, 2026 results indicates that the valuation depends on continued Azure and Copilot growth and the conversion of high capital spending into cash flows, weighed against margin pressure, capacity risks, and declining Windows and Xbox businesses.
Figures in the text are as of 2026-08-26; the live price is shown at the top of the page.
Quarterly revenue was $90.0 billion, up 18%, and net income was $35.8 billion. Intelligent Cloud led performance with revenue of $39.3 billion and growth of 32%, while Azure and other cloud services grew 43%. Productivity and Business Processes generated revenue of $37.8 billion, up 14%, while More Personal Computing revenue declined 4% to $12.9 billion.
Microsoft 365 Copilot exceeded 30 million paid seats in fiscal Q4 2026, and net seat additions more than doubled compared with the previous quarter. The number of customers with more than 50 thousand seats increased more than sevenfold year over year, while EY deployed the E7 suite to approximately 400 thousand employees. In GitHub Copilot, the user count reached 50 million and revenue accelerated by more than 60% compared with the previous quarter after the implementation of usage-based pricing.
Azure revenue exceeded $100 billion in fiscal 2026 and grew 41% for the fiscal year. In fiscal Q4 2026, Azure and other cloud services grew 43%, and management expects growth of approximately 45% in constant currency in fiscal Q1 2027. The commercial obligations balance also reached $678 billion, but demand continuing to exceed available capacity makes the timing of bringing new infrastructure online a critical factor in how quickly demand is converted into revenue.
Automated analysis for informational purposes only — not investment advice.
Capital expenditures reached $41 billion in fiscal Q4 2026, with approximately two-thirds directed toward short-lived assets, particularly central processing units and graphics processing units. Operating cash flow reached $55.4 billion, up 30%, but free cash flow was $19.6 billion after the increase in capital spending. Management expects capital expenditures to exceed $50 billion in fiscal Q1 2027, while operating margins remain approximately stable year over year in that quarter.
More Personal Computing revenue declined 4% to $12.9 billion in fiscal Q4 2026, while the segment's operating income fell 14% and its margin declined to 21%. Xbox revenue decreased 10%, while Windows OEM and Devices revenue fell 7% due to weakness in the PC market and a more difficult comparison with the impact of the end of Windows 10 support. For fiscal Q1 2027, management expects Windows OEM and Devices to decline in the low twenties range and Xbox content and services to decline in the mid-single-digit range.
Management expects total revenue of between $89.85 billion and $90.95 billion, representing growth of between 16% and 17%. It expects Intelligent Cloud revenue of between $40.95 billion and $41.25 billion and Azure growth of approximately 45% in constant currency, compared with revenue of between $36.7 billion and $37.0 billion for Productivity and Business Processes. In contrast, it expects cost of revenue of between $29.6 billion and $29.8 billion, operating expenses of between $16.8 billion and $16.9 billion, and capital expenditures exceeding $50 billion.
