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As earnings season continues, major tech titans will release their Q2 earnings.
Both Microsoft and Meta report on Wednesday, July 30th after the closing bell, and financial markets are eager to see how both performed amid AI innovation, cloud growth and trade challenges. Markets are expecting positive results from both.
Microsoft: Strong Cloud and AI Growth
Wall Street Estimates
Microsoft is expected to report its fiscal Q4 2025 earnings with strong results, with earnings per share (EPS) expected to come in at $3.38 per share, up 14.57% YoY, while revenue is expected to come in at $73.86 billion, up 14.1% YoY. ⁽¹⁾
Microsoft has consistently beaten Wall Street’s earnings estimates since 2022. Microsoft’s upcoming earnings are expected to show strong momentum in its core business segments, which are mainly driven by AI innovation and investments and robust cloud adoption. ⁽²⁾
Productivity and Business Segments
Microsoft’s productivity and business segments are expected to bring in $32.1 billion in revenues, which indicates an increase of 12.2% YoY, as strong platform expansions and product launches have supported this momentum. ⁽³⁾
Intelligent Cloud
The Intelligent Cloud segment, which is led by Azure, remains a key growth driver. The Intelligent Cloud is expected to report $28.89 billion, up 21.5% YoY. ⁽⁴⁾
Gaming Segment
In Gaming, the company expects revenues to grow in mid-single digits. Microsoft expects Xbox content and services revenues to grow in the high single digits. This moderate performance in consumer-facing segments contrasts with the stronger enterprise and cloud divisions. ⁽⁵⁾
Additional Factors to Watch
- Azure AI Performance
- AI Innovation
- CAPEX Trends
- Margin Pressure and Effectiveness in Operation
- Forward Guidance and Management Commentary
Meta’s Ad Revenue Fuels AI Investments
Wall Street Estimates
Meta is expected to report Q2 earnings with optimistic results, with earnings per share (EPS) expected to come in at $5.86, up 16.56% YoY, while revenue is expected to come in at $42.31 billion, up 16.1% YoY. ⁽⁶⁾
Meta is backed by strong historical earnings, while sentiment on the stock appears bullish. ⁽⁷⁾ Markets will be watching Meta’s key growth drivers such as its advertising segment, CAPEX, and AI.
Digital Ad Segment
Meta’s advertising segment, a key driver for revenue growth, is expected to report $43.93 billion in revenue, as revenue per user came at $49.63, up 11.28 YoY in Q1. AI-powered ad tools are expected to contribute a growth of 5% in reel conversions. ⁽⁸⁾
AI Strategy
Meta’s $70 billion 2025 CAPEX plans to support its open-source Llama model, with revenue per customer already showing promising numbers, proving AI can enhance monetization. ⁽⁹⁾
Additional Factors to Watch
- AI Impacts on Ads
- CAPEX and AI Infrastructure
- Reality Labs Performance
- Whatsapp Performance
- AI Trends
- Forward Guidance and Commentary on Tariffs
Bottom Line
Financial markets will monitor earnings from both these tech titans of the Magnificent 7 as AI and cloud computing remain in a strong momentum.
Solid growth is expected by both Meta and Microsoft, with their forward guidance, margins and other factors having the potential to impact both stocks’ prices.
