What Will Decide Microsoft Stock Over The Next Six Months?
For questions about this article or underlying research, email help@trefis.com.
Microsoft (MSFT) stock returned 27.2% between May 5 and November 3, 2026, compared with a 4.8% return for the S&P 500. During its October 28 call, management said customer demand still exceeds the capacity it has. The company also said that some third-party capacity it had counted on moved into the second half of the fiscal year. Below are the dates most likely to move Microsoft stock over the next six months, and the three that matter most.
| What to watch | When | Which way it cuts |
|---|---|---|
| Grand Theft Auto VI comes to Xbox as part of Microsoft’s holiday game lineup | November 2026 | In its favor |
| Fiscal Q2 2027 results, with Azure growth guided at 49% to 50% in constant currency | January 2027 | Either way |
| Capital spending speeds up again, after about $170 billion in calendar 2026 | second half of fiscal 2027 | Against the stock |
| Delayed third-party GPU capacity contracts come online | second half of fiscal 2027 | Either way |
Azure Growth In Microsoft’s Next Report
Microsoft is expected to report its fiscal Q2 2027 results in January 2027. For that quarter, management guided Azure revenue growth of 49% to 50% in constant currency, following 48% growth in fiscal Q1 2027.
Azure operates inside Microsoft Cloud. That broader group brought in $63.9 billion in fiscal Q1 2027, about two-thirds of the company’s revenue. Management said it is counting on more efficiency gains across its CPU and GPU fleet to reach the guide, because some third-party GPU contracts slipped into the second half of fiscal 2027. Measured against that guide, Azure growth in constant currency is the number to watch in the January 2027 report.
Microsoft’s Rising Capital Spending
Management expects capital spending of over $50 billion in fiscal Q2 2027. The company currently expects spending to speed up in the second half of fiscal 2027, mainly on CPUs, GPUs, higher memory and storage costs and the delayed third-party capacity.
That is a large outlay even for Microsoft. Management put calendar 2026 spending at about $170 billion, close to half of the $346 billion of revenue the company took in over the last twelve months. Management expects Microsoft to stay free cash flow positive in fiscal 2027, and said it will tap other sources of funding when it finds them attractive. Capital spending and free cash flow are the figures to watch in the January 2027 report.
Xbox Holiday Game Sales
Microsoft entered the holiday season with one of its strongest first- and third-party game lineups in years, management said on October 28. That roster includes Grand Theft Auto VI, which the company said was coming to Xbox the following month.
The lineup arrives after a soft quarter. Xbox revenue fell 2% in fiscal Q1 2027, inside a Devices and Consumer segment that brought in $15.5 billion. For fiscal Q2 2027, management guided that segment to $15.9 billion to $16.4 billion of revenue. On its July 29 call, management said it expects the gaming business to return to growth in fiscal 2027. Xbox content and services revenue, which also fell 2% in fiscal Q1 2027, is the measure to watch in the January 2027 report.
Can You Hold Microsoft Stock Through These Dates?
Over the past year, Microsoft stock’s worst stretch was a 31.8% fall in closing prices during the 160 trading sessions to June 25, 2026. The shares have swung both ways around earnings calls. They fell 9.8% around the January 28, 2026 call and rose 14.7% around the July 29, 2026 call.
If a fall that deep in your Microsoft position would push you to sell, the position is too large to hold through these dates. If you could sit through a repeat, your position is a size you can hold through the January 2027 report and the spending that follows.
Does This Mean You Should Act On MSFT?
Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.
There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.
Spot an error or want more like this? Tell us in 10 seconds.