Microsoft (MSFT) Q3 2025 Earnings Preview: What Should Investors Expect?

Source Tradingkey

TradingKey - Microsoft will report its 2025Q3 earnings on 30th of April, after the market closes. As one of the big tech companies and part of the Mag 7, Microsoft earnings are always seen as important news.  These are the following aspects investors should pay attention to:

The stock price now is 13% lower than the peak three months ago and the forward PE is standing at 28x, a valuation neither high nor very low considering the growth prospects.

Revenue and Earnings:

The market expects $68.44 billion in revenue and $3.22 earnings per share, 10.6% and 9.7% growth from 2024Q3. The top-line growth shows a certain level of slowdown which can be explained by the maturing market, increased competition and general economic slowdown.

While the revenue number is usually quite easy to predict, the EPS number may fluctuate a lot due to the investment in OpenAI. Last quarter, Microsoft recorded a $1.17 billion loss from the OpenAI investment in its income statement, and we expect this number to increase in the coming quarters, as OpenAI is ramping up investments.

MSFT Businesses Amidst Tariffs:

We believe the software business of MSFT won’t be affected much by the current tariff environment, as the focus of the tariffs doesn’t include software products. However, the business related more closely with personal computing might take a hit due to the worsened consumer sentiment.  

The cloud segment will be subject to scrutiny, as this is the fastest growing business line of the company, and it’s also closely related to the development of AI. In the past quarters Microsoft cloud saw a very high rate of growth of around 20% but due to the supply chain (infrastructure) bottleneck affecting all the cloud players, the cloud operating margins have been quite stagnant.

 Figure 1: Microsoft

Source: Company Reports

The most recent earnings from Alphabet showed Google Cloud margin flat compared with the previous quarters, implying that we won’t see dramatic ramp up in cloud profitability for Microsoft either.  

AI Race Is Far from Over

Even though the main narrative for the equity markets now is tariffs, AI continues to be the centerpiece of the future for the big tech firms. As one of the major AI scalers, it is important for investors to follow the AI developments of the company including:

Capital Expenditures: MSFT plans to spend $80 billion of capex mainly for AI and data centers, thus investors would expect any news on the ROI of this massive amount of spedning.  Any guidance from the management with regard to potential change in the capex plans will also be a valuable insight.

Partnership with OpenAI: OpenAI is perhaps the most important AI company in the world and Microsoft as one of the major investors in it is already tied with the future performance of the Sam Altman’s company. Investors should look for any development in the partnership between the two companies, as well as any change in the terms of their business conditions.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Nvidia 2026 Shareholder Meeting Preview: Can Stock Price Hit New Highs? How Blackwell, Vera Production Ramps Will Determine Future Revenue?This Wednesday (June 24), NVIDIA (NVDA) will hold its 2026 annual meeting of stockholders online. The focus of this meeting will be the production ramp-up of Blackwell and the brand-new V
Author  TradingKey
8 hours ago
This Wednesday (June 24), NVIDIA (NVDA) will hold its 2026 annual meeting of stockholders online. The focus of this meeting will be the production ramp-up of Blackwell and the brand-new V
placeholder
Morgan Stanley’s Latest Assessment: Three Variables for Gold’s Rise to $5,200 — Hawkish Fed, ETF Flows, and Middle East TurmoilMorgan Stanley ( MS )'s latest precious metals research report shows that while continuous gold purchases by global central banks have provided a solid floor of support, gold ( XAUUSD )'s
Author  TradingKey
9 hours ago
Morgan Stanley ( MS )'s latest precious metals research report shows that while continuous gold purchases by global central banks have provided a solid floor of support, gold ( XAUUSD )'s
placeholder
Qatar and Pakistan: High-level committee agrees on roadmap to final deal within 60 daysThe US-Iran peace talks took place on Sunday in Bürgenstock, Switzerland, with delegations from Iran, the United States, Qatar, and Pakistan participating.
Author  FXStreet
16 hours ago
The US-Iran peace talks took place on Sunday in Bürgenstock, Switzerland, with delegations from Iran, the United States, Qatar, and Pakistan participating.
placeholder
Silver Price Forecast: XAG/USD rebounds to near $66.00 amid fading US-Iran talks optimismSilver price (XAG/USD) halts its three-day losing streak, trading around $65.90 per troy ounce during the Asian hours on Monday.
Author  FXStreet
17 hours ago
Silver price (XAG/USD) halts its three-day losing streak, trading around $65.90 per troy ounce during the Asian hours on Monday.
placeholder
WTI Price Forecast: Trades above $75.50 on Iran uncertainty; 200-day SMA holds the keyWest Texas Intermediate (WTI) – the benchmark US Crude Oil price – struggles to capitalize on the overnight bounce from the $72.80 region, or the lowest level since early March, and oscillates in a narrow band during the Asian session on Friday.
Author  FXStreet
Jun 19, Fri
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – struggles to capitalize on the overnight bounce from the $72.80 region, or the lowest level since early March, and oscillates in a narrow band during the Asian session on Friday.
goTop
quote