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Microsoft — Q4 FY26 Earnings Explained simply: where the money came from, and where it went

Q4 FY26 · Quarter ended 2026-06-30
Reported 2026-07-29

Microsoft closed fiscal 2026 with $90B in revenue, Azure up 43% and past $100B for the year — and a $3.2B Anthropic gain flattered the bottom line.

Revenue growth+18%EPS (GAAP)$4.81Azure growth+43%Commercial RPO$678B

Follow the money, left → right. Hover or tap any block or band to trace where that money comes from and where it goes. Tap a block to pin it and read what it means below. Tap the background to reset.

Revenue

In plain English

This quarter

Follow $100 of revenue

Charts in billions are hard to feel. Here is the same quarter, shrunk down: for every $100 Microsoft took in, this is where it went.

Productivity & Business
$42.05
Intelligent Cloud
$43.67
More Personal Computing
$14.28
Cost of revenue
−$32.80
R&D
−$11.11
Sales & marketing
−$8.44
G&A
−$2.54
Other income
$3.83
Tax
−$9.20
Kept as profit
$39.74

Intelligent Cloud is now the largest piece at $43.67 of every $100 — ahead of Productivity and Business Processes at $42.05.

Three things to take away

If you only remember three numbers from this quarter, make it these.

+43%

Azure is still accelerating

Azure grew 43%, up from 40% the prior quarter, and passed $100B in revenue for the full fiscal year.

$678B

The backlog is enormous

Commercial remaining performance obligation hit $678B, up 84% — years of contracted cloud and AI spending not yet recognized.

$3.2B

The bottom line got a boost

A $3.2B gain on Microsoft's Anthropic investment lifted other income — and discrete items together added $0.27 to EPS.

One-time items to know about

Things that make this quarter look different from a normal one — so you don't mistake them for the trend.

  • $3.2B gain from Microsoft's investment in Anthropic, lifting other income and net income.
  • Lower-than-expected expenses from the Voluntary Retirement Program, partly offset by severance expense and impairment charges in Xbox — together the discrete items added $0.27 to diluted EPS.
  • $480M net gain from investments in OpenAI (+$0.07 EPS), excluded from non-GAAP results (non-GAAP net income was $35.3B, EPS $4.74).

Other quarters

The same chart, for every quarter we've covered.