Microsoft Earnings: Analysts Trim Price Targets Before Call

Microsoft Corp. (MSFT) will release its fiscal 2026 fourth-quarter results on July 29 after the market closes. The stock rose as analysts trimmed 12-month price targets amid concerns over AI data-center spending and margin pressure, though consensus targets still imply significant upside ahead of the call.

Earnings Date, Expectations, and Analyst Targets

Microsoft said on its investor-relations site that it will report fiscal 2026 Q4 results after the market close on July 29 and host a conference-call webcast at 2:30 p.m. Pacific Time (17:30 ET), accessible via its website.

In the most recent quarter, fiscal 2026 Q3, Microsoft posted revenue of $82.9 billion, net income of $31.8 billion, and diluted earnings per share (EPS) of $4.27. Trailing 12-month EPS stood at $16.79, with trailing revenue of $281.7 billion and net income of $101.8 billion. Analysts expect diluted EPS near $4.21 for Q4 and a full-year consensus EPS around $17.36, setting benchmarks for evaluating management’s commentary.

Analyst consensus across tracker samples centers on an average 12-month price target near $560, with roughly 48 analysts rating the stock as a Moderate Buy. Several firms have trimmed targets without downgrading ratings. Argus Research lowered its target to $510 from $620 while maintaining a Buy rating and keeping Microsoft on its Focus List. BMO Capital Markets cut its target to $500 from $515 and retained an Outperform rating. Wolfe Research reduced its target to $525 from $570 and raised its fiscal 2027 capital expenditure (capex) estimate to $270 billion from $230 billion, citing higher memory-chip costs and projecting increased free-cash-flow pressure.

Goldman Sachs maintains a Buy rating with a $610 target, modeling Azure constant-currency growth of about 40–41% for the quarter as the basis for that objective. DA Davidson and Citizens hold $550 targets, while Barclays carries a $600 target, reflecting confidence in long-term AI monetization.

Third-party modeling estimates AI data-center spending near $80 billion in fiscal 2025, driving elevated capital spending and margin sensitivity. Rising AI capex and chip costs are central to the recent target reductions. Microsoft’s forward 12-month price-to-sales ratio of 8.86 times, compared with an industry average of 7.55 times, highlights valuation sensitivity.

Views are diverging. One report flagged the first Sell rating in about three months, while other tallies show no Sell ratings among current analysts, indicating growing dispersion ahead of the earnings call.

Investors will focus on management’s updates on Copilot monetization, Azure growth, and capital-expenditure plans. The webcast will be a key moment to assess whether rising AI spending will pressure margins and free cash flow.