Microsoft disclosed strong fiscal fourth-quarter results, with the company’s stock gaining 3% in extended trading on Wednesday. Total revenue expanded approximately 18% year-over-year in the quarter ending June 30. Net income reached $35.77 billion, or $4.81 per share, compared to $27.23 billion, or $3.65 per share, in the equivalent period a year prior.
The company benefited from a $3.2 billion gain related to its investment in artificial intelligence firm Anthropic and realized lower-than-projected expenses from a voluntary retirement program initiative. These gains were partially offset by an impairment charge affecting the Xbox gaming division. Despite the strong quarterly performance, Microsoft shares have declined 19% so far in 2026, whereas the S&P 500 index has appreciated approximately 7% during the same period.
The Intelligent Cloud segment, anchored by Azure, generated $39.31 billion in revenue, representing 31.6% year-over-year growth and surpassing analyst consensus of $38.16 billion. Azure cloud service growth accelerated to 43% at constant currency, exceeding expectations of 40.2%. Microsoft reported that Azure revenue for the entire 2026 fiscal year exceeded $100 billion for the first time, positioning the business behind Amazon Web Services while remaining larger than Alphabet’s Google Cloud operation.
The Productivity and Business Processes segment produced $37.85 billion in revenue, growing 14.3% and beating the StreetAccount consensus estimate of $37.19 billion. Microsoft 365 Copilot, the company’s work assistant product, achieved over 30 million paid seats. The More Personal Computing segment contributed $12.85 billion in revenue, down 4.4% from the prior year but exceeding analyst estimates of $12.17 billion. Capital expenditures and finance leases reached $41 billion, jumping 69% sequentially, while free cash flow declined 23% to $19.64 billion. Commercial remaining performance obligations increased 8% to $678 billion from the previous quarter.
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