What factors could drive MSFT's EPS higher in Q3 2025?

**Microsoft's EPS is likely to be driven higher in Q3 2025 by the following factors:**

1. **Growth in Productivity and Business Processes**: Microsoft's Productivity and Business Processes segment is expected to generate revenues between $19.3 billion and $19.6 billion, with a model estimate of $19.58 billion, indicating an increase of 11.8% year-over-year. The strong adoption of Office 365 Commercial and Dynamics 365 is expected to drive top-line growth.
2. **Increased Adoption of Cloud Services**: The ongoing growth of Microsoft's cloud platform, including Azure, Office 365, and other cloud services, is expected to contribute to robust performance. Azure and other cloud services are anticipated to continue their growth trajectory.
3. **AI Initiatives**: Microsoft's aggressive investments in AI are expected to yield results, as the company balances capital expenditure with long-term return on investment. The AI business is showing significant progress, with an annual revenue run rate of $13 billion, up 175% year-over-year.
4. **Market Position and Partnerships**: Microsoft's strategic partnerships, such as with OpenAI and Oracle, are likely to enhance its AI capabilities and market position. The company's investment in AI infrastructure and data centers is expected to support the growth of its cloud and AI services.

In conclusion, Microsoft's EPS is expected to be higher in Q3 2025 due to growth in its Productivity and Business Processes segment, increased adoption of cloud services, AI initiatives, and its strong market position and partnerships.