Microsoft Corp

Microsoft's FY2026 revenue rose 18% to $331.8B with net income of $133.7B and diluted EPS of $17.95, as Microsoft Cloud revenue increased 27% to $214.4B.

Revenue increased $50.1B or 18% driven by growth in Microsoft Cloud, with Intelligent Cloud revenue increased driven by Azure and Productivity and Business Processes revenue increased driven by Microsoft 365 Commercial cloud, while More Personal Computing revenue decreased driven by XBOX, offset in part by growth in Search advertising. Cost of revenue increased $18.5B or 21% driven by growth in Microsoft Cloud, and operating expenses increased $4.9B or 7% driven by continued investments in research and development compute capacity, AI talent, and data to support product development that benefits the entire portfolio, impairment and other related expenses in our XBOX business, investments in commercial sales, and higher Copilot advertising expenses.

Other income (expense), net was $10,697M for fiscal year 2026 versus $(4,901)M for fiscal year 2025, and included $6.5B of net gains and $4.8B of net losses for fiscal years 2026 and 2025, respectively, from investments in OpenAI, primarily net recognized gains (losses) on our equity method investment reflected in Other, net. The net gains recorded for fiscal year 2026 primarily relate to the dilution gain from the OpenAI Recapitalization. The filing defines adjusted net income (non-GAAP) of $128,786M and adjusted diluted EPS (non-GAAP) of $17.28, which exclude net (gains) losses from investments in OpenAI.

Capital returned — dividends paid $26.4B (prior $24.1B), share repurchases $22.3B (prior $18.4B); capital expenditures $115.9B (prior $64.6B) (selected cash-flow amount, not necessarily total capital investment).

“Cash from operations increased $46.8 billion to $182.9 billion for fiscal year 2026, primarily due to an increase in cash received from customers and a decrease in cash used to pay income taxes, offset in part by an increase in cash paid to suppliers. Cash used in financing increased $847 million to $52.5 billion for fiscal year 2026, primarily due to a $6.0 billion decrease in cash used for repayments of debt, offset in part by a $3.9 billion increase in common stock repurchases and a $2.4 billion increase in dividends paid. Cash used in investing increased $66.9 billion to $139.5 billion for fiscal year 2026, primarily due to a $51.4 billion increase in additions to property and equipment and a $22.2 billion increase in cash used in other investing primarily to facilitate the purchase of components, offset in part by a $4.2 billion decrease in cash used in the acquisition of companies, net of cash acquired and divestitures, and purchases of intangible and other assets and a $2.4 billion decrease in cash used in net investment purchases, sales, and maturities.”

— Filing statement

“During fiscal years 2026 and 2025, we repurchased 36 million shares and 31 million shares of our common stock for $16.7 billion and $13.0 billion, respectively, through our share repurchase program. All repurchases were made using cash resources. As of June 30, 2026, $40.6 billion remained of our $60 billion share repurchase program.”

— Filing statement

“During fiscal years 2026 and 2025, our Board of Directors declared dividends totaling $27.0 billion and $24.7 billion, respectively. We intend to continue returning capital to shareholders in the form of dividends, subject to declaration by our Board of Directors.”

— Filing statement

Return on equity was 30.2% (prior 29.6%) (period net income / period-end equity, not annualized); return on assets 17.6% (prior 16.5%) (period net income / period-end assets, not annualized).

No forward financial guidance is provided in the filing; the MD&A states that the investments being made in cloud and AI infrastructure and devices will continue to increase operating costs and may decrease operating margins.

Leverage: Identified debt as of 2026-06-30: reported debt balance of unestablished maturity scope of $31.1B. The concept behind this balance does not establish which maturities it covers. Total debt, net debt and debt-to-equity are therefore not stated.

Liquidity: Cash, cash equivalents, and short-term investments totaled $76.8B as of June 30, 2026, and the filing states that existing cash, cash equivalents, short-term investments, cash flows from operations, and access to capital markets are expected to continue to be sufficient to fund operating activities and cash commitments for at least the next 12 months and thereafter for the foreseeable future.

Cash flow: Cash flow — operating $182.9B, investing $-139.5B, financing $-52.5B.

Working capital: Current assets $207.7B vs. current liabilities $168.8B (current ratio 1.23x). Prior reported balance sheet as of 2025-06-30: $191.1B vs. $141.2B (1.35x).