Microsoft Set to Report Earnings Amid Focus on Workforce Reductions and Cash Flow Dynamics

Microsoft is scheduled to release its quarterly financial results after the market closes on Wednesday.

According to LSEG estimates, analysts anticipate the following:

• Earnings: $4.73 per share, adjusted
• Revenue: $90.69 billion

For the fiscal first quarter ended September 30, Microsoft will report under two operating segments for the first time since 1998, consolidating the three-segment structure—covering Azure, Office, and Windows—that had been in place for the past 11 years.

The company will also begin disclosing Azure cloud revenue in dollar terms. StreetAccount surveys project $32.32 billion, representing growth exceeding 44%.

Microsoft has been aggressively expanding its artificial intelligence infrastructure and enhancing products to strengthen its AI position, while maintaining positive free cash flow—a distinction from fellow hyperscalers. Cloud competitors Alphabet and Amazon, reporting Wednesday and Thursday respectively, both posted negative free cash flow in the June quarter, while Meta reported a similar shortfall in the third quarter.

As of Tuesday’s close, Microsoft shares had risen nearly 10% year-to-date, lagging the S&P 500’s approximately 13% gain over the same period.

During the fiscal first quarter, Microsoft eliminated 4,800 positions and announced on Monday a voluntary buyout program for up to 60,000 employees as it balances costly AI investments with capital efficiency.

StreetAccount analysts project $50.67 billion in capital expenditures and finance leases for the quarter.

The quarter also saw Microsoft establish an AI implementation unit and unveil a Copilot AI “super app” with coding capabilities.

Executives will discuss results and provide guidance on a conference call beginning at 5:30 p.m. ET.

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