Microsoft Reports Over $81 Billion Revenue in Q2
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 19 2026
0mins
Should l Buy MSFT?
Source: NASDAQ.COM
- Significant Revenue Growth: Microsoft reported total revenue of $81.3 billion for Q2 FY2026, marking a 23% year-over-year increase, indicating strong growth potential in cloud computing and AI, despite a 19% decline in stock price year-to-date.
- Cloud Business Surge: The Microsoft Cloud segment surpassed $50 billion in revenue for the first time, growing 26% year-over-year, reflecting robust market demand for its platform, as emphasized by CEO Satya Nadella, highlighting its strategic importance.
- Cash Flow Pressure: Despite strong operating cash flow, Microsoft's free cash flow fell to $5.9 billion in Q2, a notable sequential decline primarily due to increased capital expenditures, which may impact future profitability.
- Profitability Under Pressure: The company's gross margin percentage was 68%, slightly down year-over-year, primarily driven by ongoing investments in AI infrastructure, underscoring the importance and challenges of cost control while pursuing growth.
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Analyst Views on MSFT
Wall Street analysts forecast MSFT stock price to rise
34 Analyst Rating
32 Buy
2 Hold
0 Sell
Strong Buy
Current: 356.770
Low
500.00
Averages
631.36
High
678.00
Current: 356.770
Low
500.00
Averages
631.36
High
678.00
About MSFT
Microsoft Corporation is a technology company that develops and supports software, services, devices, and solutions. Its Productivity and Business Processes segment consists of products and services in its portfolio of productivity, communication, and information services, spanning a variety of devices and platforms. It comprises Microsoft 365 Commercial products and cloud services; Microsoft 365 Consumer products and cloud services; LinkedIn, and Dynamics products and cloud services. The Intelligent Cloud segment consists of its public, private, and hybrid server products and cloud services. It comprises server products and cloud services, including Azure, and enterprise and partner services, including Enterprise Support Services. Its More Personal Computing segment primarily comprises Windows and Devices, including Windows OEM licensing; Gaming, including Xbox hardware and Xbox content; Search and news advertising, comprising Bing and Copilot, Microsoft News, and Microsoft Edge.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Cloud Service Competition: The CMA noted that Microsoft's software licensing practices may reduce competition in cloud services, and an SMS designation will provide a pathway to address this issue, ensuring a fair competitive environment for software tools as AI-driven innovations emerge.
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