Microsoft's Q2 Earnings: What to Expect and Why It Matters

Microsoft is set to report its fiscal second quarter earnings this week, and investors are eagerly awaiting the results. As one of the world's most valuable companies, Microsoft's performance has a significant impact on the broader tech industry and the global economy. Here's what to expect from Microsoft's Q2 earnings and why it matters.

Revenue Growth: Microsoft's revenue has been growing consistently, with a 16% year-over-year increase in the first quarter of fiscal year 2025. This growth can be attributed to the strong performance of its cloud services and AI offerings. Analysts expect Microsoft's revenue to grow by 11.1% year-over-year in the second quarter, marking its slowest earnings growth in eight quarters and slowest sales growth in six quarters. However, this growth is still impressive, given the company's size and market dominance.

Azure Cloud Growth: Azure, Microsoft's cloud computing platform, has been a significant driver of growth. In the first quarter of fiscal year 2025, Azure revenue surged by 33%, reflecting the company's continued investments in AI and cloud infrastructure. Analysts expect Azure revenue to rise by 31.7% in the third quarter, driven by more data center capacity coming online.