Zacks Research Analysts Cut Earnings Estimates for Microsoft

Microsoft Co. (NASDAQ:MSFT - Free Report) - Equities research analysts at Zacks Research cut their Q2 2025 EPS estimates for shares of Microsoft in a research note issued to investors on Wednesday, November 20th. Zacks Research analyst V. Sawalka now forecasts that the software giant will earn $3.10 per share for the quarter, down from their prior estimate of $3.19. The consensus estimate for Microsoft's current full-year earnings is $12.94 per share. Zacks Research also issued estimates for Microsoft's Q3 2025 earnings at $3.15 EPS, Q4 2025 earnings at $3.29 EPS, Q1 2026 earnings at $3.46 EPS, Q2 2026 earnings at $3.57 EPS, Q3 2026 earnings at $3.66 EPS, Q4 2026 earnings at $3.83 EPS, FY2026 earnings at $14.53 EPS and FY2027 earnings at $17.32 EPS.

Microsoft (NASDAQ:MSFT - Get Free Report) last issued its quarterly earnings data on Wednesday, October 30th. The software giant reported $3.30 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $3.10 by $0.20. The business had revenue of $65.59 billion during the quarter, compared to analyst estimates of $64.57 billion. Microsoft had a return on equity of 34.56% and a net margin of 35.61%. The business's revenue for the quarter was up 16.0% compared to the same quarter last year. During the same period in the prior year, the company posted $2.99 EPS.

A number of other equities analysts have also issued reports on MSFT. Sanford C. Bernstein decreased their price target on Microsoft from $501.00 to $500.00 and set an "outperform" rating for the company in a research note on Friday, October 25th. Truist Financial reaffirmed a "buy" rating and set a $600.00 target price on shares of Microsoft in a research note on Monday, October 28th. The Goldman Sachs Group cut their price target on shares of Microsoft from $515.00 to $500.00 and set a "buy" rating for the company in a report on Thursday, October 10th. Wedbush restated an "outperform" rating and set a $550.00 price objective on shares of Microsoft in a research report on Tuesday. Finally, Royal Bank of Canada reiterated an "outperform" rating and issued a $500.00 target price on shares of Microsoft in a report on Tuesday, November 5th. Three research analysts have rated the stock with a hold rating and twenty-seven have issued a buy rating to the company. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average price target of $503.03.

Microsoft Stock Performance

Shares of MSFT traded up $4.13 during trading hours on Friday, reaching $417.00. 24,070,754 shares of the company's stock traded hands, compared to its average volume of 20,538,887. The firm has a market capitalization of $3.10 trillion, a price-to-earnings ratio of 34.23, a P/E/G ratio of 2.21 and a beta of 0.91. The business's fifty day simple moving average is $422.21 and its two-hundred day simple moving average is $426.05. Microsoft has a twelve month low of $362.90 and a twelve month high of $468.35. The company has a debt-to-equity ratio of 0.15, a current ratio of 1.30 and a quick ratio of 1.29.

Microsoft announced that its Board of Directors has initiated a share repurchase program on Monday, September 16th that permits the company to buyback $60.00 billion in shares. This buyback authorization permits the software giant to buy up to 1.9% of its stock through open market purchases. Stock buyback programs are generally a sign that the company's leadership believes its stock is undervalued.

Microsoft Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, December 12th. Shareholders of record on Thursday, November 21st will be given a dividend of $0.83 per share. This is a positive change from Microsoft's previous quarterly dividend of $0.75. The ex-dividend date of this dividend is Thursday, November 21st. This represents a $3.32 dividend on an annualized basis and a yield of 0.80%. Microsoft's payout ratio is currently 24.75%.

Insider Activity

In other news, insider Bradford L. Smith sold 40,000 shares of the business's stock in a transaction dated Monday, September 9th. The shares were sold at an average price of $402.59, for a total transaction of $16,103,600.00. Following the transaction, the insider now owns 544,847 shares in the company, valued at approximately $219,349,953.73. The trade was a 6.84 % decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, CFO Amy Hood sold 38,000 shares of the stock in a transaction dated Thursday, September 5th. The shares were sold at an average price of $410.55, for a total transaction of $15,600,900.00. Following the completion of the sale, the chief financial officer now owns 496,369 shares of the company's stock, valued at approximately $203,784,292.95. The trade was a 7.11 % decrease in their position. The disclosure for this sale can be found here. Over the last ninety days, insiders have sold 183,431 shares of company stock valued at $74,956,968. 0.03% of the stock is owned by insiders.

Institutional Trading of Microsoft

Several institutional investors have recently modified their holdings of the company. International Assets Investment Management LLC boosted its holdings in Microsoft by 48,526.1% during the third quarter. International Assets Investment Management LLC now owns 38,501,645 shares of the software giant's stock valued at $16,567,258,000 after purchasing an additional 38,422,466 shares in the last quarter. Swedbank AB acquired a new stake in Microsoft in the 1st quarter valued at $5,587,119,000. Wulff Hansen & CO. grew its position in Microsoft by 47,196.6% in the second quarter. Wulff Hansen & CO. now owns 4,834,658 shares of the software giant's stock valued at $2,160,850,000 after acquiring an additional 4,824,436 shares during the period. Geode Capital Management LLC raised its stake in Microsoft by 2.0% during the third quarter. Geode Capital Management LLC now owns 165,024,812 shares of the software giant's stock worth $70,790,682,000 after acquiring an additional 3,264,648 shares in the last quarter. Finally, Vanguard Group Inc. lifted its holdings in shares of Microsoft by 0.5% during the first quarter. Vanguard Group Inc. now owns 667,987,038 shares of the software giant's stock valued at $281,035,506,000 after acquiring an additional 3,078,099 shares during the period. Institutional investors and hedge funds own 71.13% of the company's stock.

Microsoft Company Profile

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services.