TLDR
- Microsoft and Alphabet will report earnings on October 28, following the Federal Reserve’s interest rate decision.
- Analysts expect Microsoft to report $90.6 billion in revenue and adjusted earnings of $4.71 per share.
- Microsoft forecasts 45% Azure growth and more than $50 billion in quarterly capital spending.
- Alphabet faces expectations of $127.9 billion in revenue after Google Cloud delivered 82% growth last quarter.
- Alphabet’s June-quarter capital spending exceeded operating cash flow by approximately $5.9 billion, putting cash generation in focus.
Microsoft (MSFT) stock faces Wednesday earnings from Microsoft and Alphabet, after the Federal Reserve announces its October 28 interest rate decision. Cloud revenue, AI spending, and cash generation will feature in both reports.
Fed Decision Arrives Before Tech Earnings
The Fed announces its decision at 2 p.m. Eastern, followed by a 2:30 p.m. news conference. Alphabet has scheduled its third-quarter call for 4:30 p.m., while Microsoft’s fiscal first-quarter call begins at 5:30 p.m.
The reports follow a difficult week for technology shares. Meta shares fell after its latest earnings as investors assessed higher AI investment and weaker cash flow. Wednesday’s releases will provide updated figures from two cloud providers.
Microsoft Stock Faces Azure and Spending Test
Analysts expect Microsoft to report $90.6 billion in revenue and $4.71 in adjusted earnings per share, according to FactSet estimates. Those forecasts represent 17% revenue growth and 14% earnings growth from a year earlier.
Microsoft previously projected 45% Azure growth on a constant-currency basis. The company said demand remained above its available computing capacity. Management also forecast quarterly capital spending above $50 billion, including changes in how it accounts for data-center leases.
That spending comes as borrowing costs pressure AI cloud operators elsewhere in the sector. Microsoft reported more than 30 million paid Microsoft 365 Copilot seats in July. Its upcoming report will show whether software adoption and cloud demand are continuing.
Alphabet Earnings Put Cloud and Cash in Focus
Wall Street expects Alphabet to post about $127.9 billion in third-quarter revenue and earnings near $3.03 per share. Revenue would rise roughly 25% from the prior year. Search advertising, YouTube and Google Cloud remain its main reported growth areas.
Google Cloud revenue climbed 82% to $24.8 billion in the June quarter. Search advertising rose 17%, while YouTube advertising increased 13%. Alphabet plans $195 billion to $205 billion in capital spending in 2026, after raising its outlook in July.
June-quarter operating cash flow reached $39.1 billion, but capital expenditure totaled $44.9 billion. That produced roughly $5.9 billion in negative free cash flow. Amazon’s October 29 earnings will provide another comparison for cloud growth and AI spending across major providers.
Alphabet’s previous $9.11 quarterly earnings per share included large unrealized investment gains, which inflated reported profit. The October report will offer updated results for its core businesses.
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