Microsoft stock surged nearly 9% in after-hours trading on July 30 following its Q4 fiscal 2026 earnings report. The shares climbed from $390.54 to $425.21, marking a remarkable turnaround after slipping during the regular session.
The tech giant posted earnings per share of $4.74, outperforming the $4.24 analysts had predicted. Revenue hit $90.01 billion, well above the forecasted $87.62 billion. Growth in the Azure cloud segment stood out, accelerating to 43% year-over-year and driving $39.31 billion in Intelligent Cloud revenue, surpassing estimates.
Strong cloud growth offsets rising capital expenditures
Microsoft’s free cash flow dropped 23% to $19.64 billion, but this was modest compared to peers like Meta Platforms, which reported steeper declines on the same day. Despite recording $41 billion in capital expenditures for the quarter expected to reach $175 billion annually investors were unfazed, reflecting confidence in Microsoft’s AI infrastructure investments.
also Microsoft extended the useful life of its data centers and office buildings from 15 to 25 years, a move reminiscent of the Dot-com era’s long-term infrastructure investments that paid off over time. This decision may bolster investor sentiment amid ongoing debates about the ROI on AI-related spending.
