Microsoft (MSFT) Q3 FY2026 Earnings Call Transcript

Date: April 29, 2026 | Source: Microsoft Investor Relations / company press release

---

Jonathan Neilson (VP, IR): On the call with me are Satya Nadella, chairman and chief executive officer, Amy Hood, chief financial officer, Alice Jolla, chief accounting officer, and Brian DeFoe, deputy general counsel and corporate secretary. On this call we will discuss certain non-GAAP items. Today's call is being webcast live and recorded. You can replay the call and view the transcript on the Microsoft Investor Relations website.

Satya Nadella (Chairman & CEO): It was a record third quarter, powered by the continued strength of the Microsoft Cloud, which exceeded $54 billion in revenue, up 29% year-over-year. This quarter, revenue was $82.9 billion, up 18% and 15% in constant currency. The impact from these investments was partially offset by ongoing efficiency gains, particularly in Azure and M365 Commercial cloud. And this quarter, roughly two thirds of our capex was for short-lived assets, primarily GPUs and CPUs. We are focused on delivering cloud and AI infrastructure and solutions that empower every business to maximize their outcomes in the agentic computing era. Our AI business surpassed an annual revenue run rate of $37 billion, up 123% year-over-year.

Amy Hood (CFO): Microsoft Cloud revenue was $54.5 billion and grew 29% and 25% in constant currency, reflecting strong demand across the Azure platform and our first-party AI applications and services. Revenue from Productivity and Business Processes was $35.0 billion and grew 17% and 13% in constant currency. Revenue from Intelligent Cloud was $34.7 billion and grew 30% and 28% in constant currency. In Azure and other cloud services, revenue grew 40% and 39% in constant currency, against a prior year that included accelerating growth. Revenue from More Personal Computing was $13.2 billion and declined 1% and 3% in constant currency. Windows OEM and Devices revenue decreased 2% and 3% in constant currency.

Looking ahead to the fourth quarter, we expect revenue growth to be between 13% and 14% in constant currency. For Intelligent Cloud, we expect revenue of $37.95 to $38.25 billion, or growth of 27% to 28%. We expect CapEx spend to increase to over $40 billion as we continue to bring more capacity online.

---

Key Q3 FY2026 Financials (from company release / investor page)

• Revenue: $82.9B (+18% YoY, +15% cc); operating income $38.4B (+20%, +16% cc); net income $31.8B (+23%); EPS $4.27 diluted (+23% GAAP, +21% non-GAAP)
• Microsoft Cloud: $54.5B (+29%, +25% cc); Azure +40% (+39% cc); commercial RPO +99% to $627B
• Intelligent Cloud: $34.7B (+30%, +28% cc); Productivity & Business Processes: $35.0B (+17%, +13% cc); More Personal Computing: $13.2B (-1%)
• AI business annual revenue run rate >$37B (+123% YoY)
• ~2/3 of capex in short-lived assets (GPUs/CPUs); Q4 capex guided to >$40B
• Returned $10.2B to shareholders (dividends + buybacks) in Q3