Microsoft Q2 Earnings Surge on Cloud and AI Strength
REDMOND, January 28, 2026 – Microsoft Corporation (NASDAQ: MSFT) reported robust fiscal second-quarter results after the market close on Wednesday, January 28, with earnings and revenue growth significantly powered by its cloud computing and artificial intelligence segments. The tech giant’s performance highlights the accelerating monetization of its AI investments.
Earnings Beat Driven by Intelligent Cloud
Microsoft’s official results for the quarter ending December 31, 2025, showed substantial profit growth. Diluted earnings per share on a GAAP basis were $5.16, a 60% increase year-over-year. On a non-GAAP basis, EPS was $4.14, rising 24%. The company cited “Microsoft Cloud and AI strength” as the primary driver for the results, with its Azure cloud platform and AI services seeing continued high demand from enterprises.
Key Financials and Market Data
| Metric | Detail |
|---|---|
| Q2 FY2026 GAAP EPS | $5.16 (Up 60% YoY) |
| Current Stock Price (MSFT) | ~$480.60 |
| 52-Week Range | $344.79 – $555.45 |
| P/E Ratio | 34.19x |
| Avg. Analyst Price Target | $616.13 (Strong Buy Rating) |
| Recent AI Development | Launch of Maia 200 AI Accelerator Chip |
AI Investment and Future Outlook
Alongside the earnings, Microsoft’s launch of its new Maia 200 AI accelerator chip underscores its commitment to building a full-stack AI infrastructure. Analysts previewing the quarter had focused on Azure growth and AI monetization, with expectations for Azure revenue growth around 38.4%. The company’s capital expenditures, a key indicator of its investment pace in AI data centers, reached $34.9 billion in the recent period. The consensus among over 40 analysts remains a “Strong Buy,” with an average price target suggesting over 28% upside from current trading levels, reflecting confidence in Microsoft’s sustained AI-led growth trajectory.
Frequently Asked Questions
When did Microsoft report Q2 FY2026 earnings?
Microsoft reported its fiscal second-quarter 2026 results after the U.S. market closed on Wednesday, January 28, 2026.
What was Microsoft’s EPS for the quarter?
Microsoft reported GAAP earnings per share of $5.16 for Q2 FY2026, a 60% increase from the year-ago quarter. Non-GAAP EPS was $4.14.
What is the analyst rating for MSFT stock?
The overwhelming consensus among Wall Street analysts is a “Strong Buy” for Microsoft stock. The average 12-month price target is approximately $616.13.
What is the Maia 200?
The Maia 200 is Microsoft’s latest in-house designed artificial intelligence accelerator chip, launched recently to power its AI cloud services and improve efficiency for large AI workloads.