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Earnings Score 82 Bullish

Microsoft Shares Surge on Robust Cloud Growth and Earnings Beat

Apr 16, 2026 01:45 UTC
MSFT
Short term

Microsoft reported third-quarter results that exceeded Wall Street expectations for both revenue and earnings per share. Strong performance in the Intelligent Cloud segment and optimistic forward guidance drove a significant rally in the company's stock.

  • EPS beat expectations at $2.22
  • Revenue reached $49.36 billion
  • Cloud revenue grew 32% YoY
  • Intelligent Cloud segment hit $19.1 billion
  • Positive Q4 guidance provided
  • Price targets raised by Citi and Wolfe Research

Microsoft (MSFT) saw its share price climb 6.5% following the release of third-quarter financial results that outperformed analyst projections across key metrics. The rally was fueled by strong demand for cloud services and commercial bookings, reinforcing the company's position in the enterprise software and infrastructure market. The company reported earnings per share of $2.22, a 9% increase year-over-year, beating the consensus estimate of $2.18. Total revenue reached $49.36 billion, representing an 18% increase from the previous year and slightly exceeding the $49.03 billion expected by analysts. A primary driver of the growth was the Intelligent Cloud segment, including Azure, which generated $19.1 billion in revenue, a 26% spike. CFO Amy Hood noted that cloud revenue grew by 32% while commercial bookings rose 28%, citing strong sales execution and customer commitment. Looking ahead, Microsoft provided revenue guidance between $52.4 billion and $53.2 billion for the next quarter, implying a 14% increase at the midpoint. This guidance, along with positive outlooks for its three main business segments, prompted analysts from Citi and Wolfe Research to raise their price targets for the stock.

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