Erste Group Bank Reduces Earnings Estimates for Microsoft

Microsoft Corporation (NASDAQ:MSFT) – Stock analysts at Erste Group Bank cut their FY2027 earnings estimates for shares of Microsoft in a research note issued to investors on Wednesday, October 21st. Erste Group Bank analyst H. Engel now expects that the software giant will earn $19.57 per share for the year, down from their prior forecast of $19.60. The consensus estimate for Microsoft’s current full-year earnings is $19.66 per share. Erste Group Bank also issued estimates for Microsoft’s FY2028 earnings at $23.53 EPS.

Microsoft (NASDAQ:MSFT) last posted its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. The company had revenue of $90.01 billion for the quarter, compared to analysts’ expectations of $87.62 billion. During the same quarter last year, the business posted $3.65 EPS. The business’s quarterly revenue was up 17.7% compared to the same quarter last year.

Several other brokerages have also issued reports on MSFT. Morgan Stanley lowered Microsoft from an “overweight” rating to a “negative” rating in a research note on Monday, October 5th. Citizens Jmp reiterated a “market outperform” rating and set a $550.00 price objective on shares of Microsoft in a research report on Tuesday, September 15th. Deutsche Bank Aktiengesellschaft reissued a “buy” rating and set a $600.00 price objective on shares of Microsoft in a report on Monday, October 12th. Benchmark restated a “buy” rating on shares of Microsoft in a research report on Friday, July 24th. Finally, The Goldman Sachs Group reaffirmed a “buy” rating and issued a $640.00 target price on shares of Microsoft in a research note on Thursday, July 30th. Forty-four equities research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat, Microsoft has an average rating of “Moderate Buy” and a consensus price target of $596.07.

Microsoft Trading Down 0.2%

Shares of NASDAQ:MSFT opened at $531.33 on Monday. Microsoft has a 52-week low of $349.20 and a 52-week high of $553.72. The firm has a fifty day moving average of $510.19 and a 200 day moving average of $437.69.

Hedge Funds Weigh In On Microsoft

Hedge funds have recently modified their holdings of the company. State Street Corp lifted its stake in Microsoft by 2.9% in the second quarter. State Street Corp now owns 315,653,206 shares of the software giant’s stock worth $117,744,959,000 after acquiring an additional 8,944,917 shares during the period. Bank of America Corp DE purchased a new position in Microsoft during the 2nd quarter valued at $27,338,370,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC increased its position in Microsoft by 0.9% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 64,375,360 shares of the software giant’s stock valued at $24,013,297,000 after purchasing an additional 543,172 shares during the period. Legal & General Group Plc purchased a new position in Microsoft during the 2nd quarter valued at $18,306,443,000. Finally, Amundi raised its holdings in Microsoft by 12.0% in the 2nd quarter. Amundi now owns 46,694,778 shares of the software giant’s stock worth $17,418,076,000 after purchasing an additional 5,019,702 shares in the last quarter. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Insider Activity

In related news, EVP Amy Hood sold 41,674 shares of Microsoft stock in a transaction on Monday, September 14th. The shares were sold at an average price of $498.27, for a total value of $20,764,903.98. Following the transaction, the executive vice president directly owned 533,624 shares of the company’s stock, valued at $265,888,830.48. The trade was a 7.24% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Takeshi Numoto sold 4,810 shares of the company’s stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the sale, the executive vice president owned 42,677 shares of the company’s stock, valued at $21,188,276.96. This represents a 10.13% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 150,314 shares of company stock worth $75,404,992 over the last ninety days. Company insiders own 0.03% of the company’s stock.

Microsoft Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Thursday, December 10th. Shareholders of record on Thursday, November 19th will be paid a $0.98 dividend. This is an increase from Microsoft’s previous quarterly dividend of $0.91. The ex-dividend date of this dividend is Thursday, November 19th. This represents a $3.92 dividend on an annualized basis and a yield of 0.7%.

Key Headlines Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analysts remain constructive ahead of earnings. Oppenheimer raised its price target to $625 from $570, while Truist lifted its target to $600 from $575; both cited strong enterprise demand and sustained Azure growth. Oppenheimer raises Microsoft target ahead of earnings
• Positive Sentiment: Wall Street expects continued AI momentum, with Azure growth projected to accelerate toward 45% and Copilot adoption supporting longer-term monetization. Microsoft’s reported cloud backlog and a reported agreement for Anthropic to spend at least $45 billion on Microsoft cloud infrastructure also reinforce demand visibility. Azure AI growth ahead of earnings
• Positive Sentiment: Microsoft expanded its AI collaboration with Dayforce across human resources, finance and operations, potentially broadening enterprise use of Microsoft’s AI and cloud ecosystem. Dayforce expands AI collaboration with Microsoft
• Neutral Sentiment: Microsoft reports after the bell Wednesday. Analysts expect approximately $4.72 EPS and $90.69 billion in revenue, while options markets imply about a 5.09% post-earnings move. Traders are positioned around $555 calls and $460 puts, signaling substantial volatility rather than a clear direction. Microsoft earnings options outlook
• Negative Sentiment: Microsoft is offering voluntary buyouts to roughly 60,000 employees across the U.S., Canada, India and the U.K. The move may reduce costs and redirect resources toward AI, but its scale raises concerns about restructuring, execution and the underlying pressure from heavy data-center investment. Microsoft offers voluntary buyouts to 60,000 employees
• Negative Sentiment: Investors are also weighing rising AI infrastructure costs, capacity constraints and possible margin pressure. A reported delay affecting a Microsoft AI data-center project in the U.K. highlights the practical bottlenecks facing the company’s aggressive capital-spending strategy. Microsoft AI data-center constraints

About Microsoft

Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops software, cloud services, devices and digital platforms. Its products and services are used by consumers, businesses, governments and educational institutions worldwide.

The company’s principal offerings include the Windows operating system; Microsoft 365 productivity applications such as Word, Excel, Teams and Outlook; Azure cloud computing and infrastructure services; Dynamics business applications; and enterprise security solutions.