Microsoft(US:MSFT) Huaan Securities·2025-11-03 05:21Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Insights - The company reported FY26Q1 results with total revenue of $77.7 billion, an 18% year-over-year increase, exceeding Bloomberg's expectations by 2.81% [5] - Operating income reached $38 billion, up 24% year-over-year, also surpassing Bloomberg's expectations by 8.15% [5] - Azure's revenue grew by 40% year-over-year, significantly exceeding the company's guidance and Bloomberg's expectations of 37% [5][6] - The company signed a substantial agreement with OpenAI for an additional $250 billion in Azure services, indicating strong demand for cloud services [6][8] Financial Performance Summary - FY26Q1 revenue: $77.7 billion (yoy +18%) [5] - Operating income: $38 billion (yoy +24%) [5] - GAAP net income: $27.7 billion (yoy +12%) [5] - Non-GAAP EPS: $4.13 (yoy +23%) [5] - CapEx (including leases): $34.9 billion, exceeding expectations of $30.1 billion [5] Business Segment Performance - Productivity and Business Processes revenue: $33 billion (yoy +17%) [5] - More Personal Computing revenue: $13.8 billion (yoy +4%) [5] - Intelligent Cloud revenue: $30.9 billion (yoy +28%) [5] - Azure revenue growth: 40% (fixed currency +39%) [5][6] Future Outlook - The company expects FY26 CapEx to accelerate, with Q1 CapEx at $34.9 billion (yoy +74%) [6] - The guidance for Azure growth in the next quarter is set at 37% (fixed currency) [6] - Revenue projections for FY2026-FY2028 are $327.1 billion, $376 billion, and $430.5 billion, respectively, with year-over-year growth rates of 16.1%, 14.9%, and 14.6% [8]