Microsoft (MSFT) Reports Q2 Earnings: What Key Metrics Have to Say

Core Insights - Microsoft reported $81.27 billion in revenue for the quarter ended December 2025, marking a year-over-year increase of 16.7% and exceeding the Zacks Consensus Estimate by 1.3% [1] - The earnings per share (EPS) for the same period was $4.14, up from $3.23 a year ago, representing a surprise of 6.84% over the consensus estimate of $3.88 [1] Revenue Performance - Revenue from Productivity and Business Processes was $34.12 billion, exceeding the average estimate of $33.49 billion, with a year-over-year change of +15.9% [4] - Intelligent Cloud revenue reached $32.91 billion, surpassing the average estimate of $32.41 billion, reflecting a year-over-year increase of +28.8% [4] - More Personal Computing revenue was $14.25 billion, slightly below the average estimate of $14.27 billion, showing a year-over-year decline of -2.7% [4] - Service and other revenue totaled $64.82 billion, exceeding the average estimate of $62.24 billion, with a year-over-year increase of +21.4% [4] - Product revenue was reported at $16.45 billion, below the average estimate of $17.86 billion, with a year-over-year change of +1.4% [4] Year-over-Year Changes - The year-over-year percentage change for More Personal Computing was -3%, compared to the analyst average estimate of -2.6% [4] - Intelligent Cloud showed a year-over-year increase of 29%, exceeding the analyst average estimate of 26.9% [4] - Productivity and Business Processes had a year-over-year increase of 16%, compared to the analyst average estimate of 13.8% [4] - Overall revenue growth was 17%, surpassing the analyst average estimate of 15.1% [4] - Microsoft 365 Commercial cloud revenue grew by 17%, compared to the average estimate of 15% [4] - Azure and other cloud services revenue increased by 39%, slightly above the analyst average estimate of 38.4% [4] - Windows OEM and Devices revenue had a year-over-year change of 1%, compared to the analyst average estimate of -5% [4] Stock Performance - Microsoft shares returned -1.4% over the past month, while the Zacks S&P 500 composite increased by +0.8% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]