Microsoft Corporation is a global technology company. It is known for software, cloud computing, business tools, artificial intelligence services, gaming, and personal computer products.
Microsoft’s stock ticker is MSFT. A ticker is the short code used to identify a company’s stock. MSFT shares are traded on the Nasdaq Stock Market.
If you searched for “Microsoft stock explained,” this guide covers Microsoft’s business model, major business areas, reported financial results, and key risks. It is for education only and does not provide an investment recommendation.
What Is Microsoft?
Microsoft develops technology used by individuals, businesses, schools, governments, and software developers.
The company began as a software business. Its best-known products include the Windows operating system and Microsoft Office applications. Microsoft has since expanded into cloud computing, cybersecurity, business software, artificial intelligence, gaming, online advertising, and computing devices.
Many Microsoft products work together. For example, a business may use Microsoft 365 for office applications, Azure for cloud computing, Teams for communication, and Microsoft security tools to protect its systems.
This connected product range can make Microsoft an important technology supplier for large organizations. However, the company competes with many other major technology businesses in each market.
Microsoft Stock at a Glance
| Item | Details |
|---|---|
| Official company name | Microsoft Corporation |
| Stock ticker | MSFT |
| Stock exchange | Nasdaq Stock Market |
| Broad sector | Technology |
| Broad industry | Software, cloud computing, and digital services |
| SEC CIK | 0000789019 |
A sector is a broad group of companies with similar business activities. Industry labels are more specific, but classifications can differ between financial data providers.
CIK stands for Central Index Key. It is the identification number that the U.S. Securities and Exchange Commission, or SEC, uses for a company in its filing system.
How Does Microsoft Make Money?
Microsoft makes money by selling access to software, computing infrastructure, online services, devices, games, advertising, and professional support.
A large part of its business uses subscriptions. Under a subscription model, customers make recurring payments for continued access to a product or service. Microsoft 365 is an example. It gives customers access to applications and online services for a monthly or annual fee.
Microsoft also charges customers for using its cloud computing services. Cloud computing allows customers to rent computing power, storage, databases, and other technology over the internet instead of owning all the equipment themselves.
Azure customers may pay according to the amount of computing resources they use. Large organizations may also sign longer-term agreements covering several Microsoft products.
Other revenue sources include software licenses, gaming subscriptions, video game sales, search and online advertising, hardware sales, technical support, and consulting services.
Microsoft’s customers include:
- Individual consumers
- Small and medium-sized businesses
- Large corporations
- Schools and universities
- Government agencies
- Software developers
- Video game players and publishers
- Advertisers
The mix of subscriptions, usage-based cloud fees, licenses, advertising, and product sales means that Microsoft does not depend on only one type of customer payment.
Main Business Areas
Business and Productivity Software
Microsoft provides applications that help people create documents, analyze information, communicate, and manage work.
Products and services in this area include Microsoft 365, Teams, Dynamics, LinkedIn, and related business tools. Customers range from individual users to large organizations.
Subscriptions are important in this area. Recurring subscriptions can make revenue more predictable than one-time software sales, although customers can still cancel, reduce, or change their plans.
Cloud Computing
Microsoft Azure provides computing power, data storage, databases, networking, artificial intelligence tools, and other online technology services.
Businesses and governments use Azure to build applications, store information, operate websites, analyze data, and run internal technology systems.
Cloud revenue can depend on customer usage. It can also depend on Microsoft’s ability to build and operate data centers efficiently.
Windows and Computing Devices
Windows is an operating system used on many personal computers. An operating system is the main software that manages a computer and allows other applications to run.
Microsoft can earn licensing revenue when computer manufacturers install Windows on new devices. It also sells certain computing devices and accessories.
This area can be affected by personal computer demand, product replacement cycles, and competition from other operating systems and device types.
Gaming
Microsoft participates in the video game market through Xbox hardware, gaming subscriptions, online services, game publishing, and digital content.
Gaming revenue can come from console sales, subscriptions, game purchases, in-game content, and fees connected with its gaming platforms.
Results in this area may depend on the popularity of new games, player engagement, hardware demand, and competition for people’s entertainment time.
Artificial Intelligence and Developer Tools
Microsoft offers artificial intelligence features through cloud services, business applications, coding tools, and other products.
It also provides tools used by software developers to write, store, test, and operate computer code. These services can strengthen Microsoft’s relationships with businesses and technology professionals.
Artificial intelligence also requires major spending on data centers, advanced computer chips, electricity, networking equipment, and software development.
Search, Advertising, and Online Services
Microsoft earns advertising revenue from search and other online properties. Advertisers generally pay to place messages in front of users or to receive visits to their websites.
Advertising results can change with user activity, competition, economic conditions, and the amount businesses are willing to spend on marketing.
Why Do Investors Follow Microsoft?
Microsoft is followed because it has a large role in business technology and consumer computing. Its products are used across many types of organizations.
Market participants often watch the company’s cloud growth, subscription demand, artificial intelligence products, data center spending, and ability to keep existing customers.
Microsoft also receives attention because several of its products can be sold to the same customer. A company that already uses Microsoft office software may also consider its cloud, security, database, or communication services.
Investors may also monitor Microsoft’s position in gaming, personal computing, online advertising, and developer tools. These markets have different growth rates, costs, and competitors.
The company’s size can provide resources for research and large infrastructure projects. At the same time, a large company may face more regulatory review and may need substantial growth to produce a meaningful change in its overall results.
Key Numbers Beginners Should Know
The figures below are reported historical results. They are not Microsoft’s current stock price, and they do not show what the company will earn in the future.
| Financial measure | Reported figure | Period | Plain-English meaning |
|---|---|---|---|
| Revenue | $331.839 billion | Fiscal year from July 1, 2025, through June 30, 2026 | The total amount Microsoft reported from selling products and services before subtracting expenses. |
| Diluted earnings per share | $17.95 per share | Fiscal year from July 1, 2025, through June 30, 2026 | The portion of profit assigned to each diluted share under accounting rules. |
Microsoft reported annual revenue of $331.839 billion for its fiscal year ended June 30, 2026. In simpler terms, the company recorded about $331.8 billion from customer contracts during that fiscal year before subtracting operating costs, taxes, and other expenses.
For the same fiscal year, Microsoft reported diluted earnings per share of $17.95. Earnings per share, or EPS, measures how much of the company’s profit is assigned to each share.
“Diluted” EPS assumes that certain securities that could become common shares are included in the share count. This gives investors a broader view than basic EPS.
These figures came from Microsoft’s fiscal 2026 Form 10-K information filed with the SEC on July 29, 2026. A Form 10-K is an annual report that a U.S. public company files with the SEC.
Revenue and EPS should be viewed together with expenses, cash flow, business conditions, and changes from earlier reporting periods. One financial measure cannot explain the whole company.
What Could Affect Microsoft?
Demand for Cloud Services
Customer demand for Azure and related services can have a major effect on Microsoft’s results. Usage may change as organizations increase, delay, or reduce technology projects.
Business Subscription Growth
Microsoft depends on organizations and individuals continuing to use its subscription products. Results can be affected by subscriber growth, customer cancellations, pricing changes, and movement between lower-priced and higher-priced plans.
Artificial Intelligence Adoption
Artificial intelligence may create demand for new tools and cloud services. However, adoption can be uneven, and Microsoft must manage development costs, computing capacity, security, accuracy, and regulatory concerns.
Data Center Costs
Cloud and artificial intelligence services require large data centers. Building and operating these facilities involves spending on land, buildings, computer chips, networking equipment, cooling systems, and electricity.
Higher demand does not automatically produce higher profit if the cost of providing the service also rises sharply.
Competition
Microsoft competes in software, cloud computing, cybersecurity, artificial intelligence, gaming, advertising, and consumer devices.
Competitors may offer lower prices, different technology, stronger products in a particular market, or services that customers find easier to use.
Economic Conditions
During a weaker economy, businesses may delay technology projects or reduce advertising spending. Consumers may also postpone computer, device, or game purchases.
Some subscriptions may be more stable than one-time purchases, but they are not protected from economic pressure.
Foreign Currency Movements
Microsoft operates internationally. Revenue earned in another currency must be translated into U.S. dollars for financial reporting.
Changes in currency exchange rates can increase or decrease reported results even when customer demand has not changed.
Key Risks
Cybersecurity and Service Disruptions
Microsoft stores and processes important customer information. Security breaches, software weaknesses, or service outages could harm customers, create costs, and damage trust.
No technology system can be guaranteed to prevent every attack or interruption.
Regulation and Legal Review
Microsoft operates in areas involving competition law, privacy, data use, artificial intelligence, cybersecurity, and digital platforms.
New rules or government actions could affect how the company designs products, handles data, completes acquisitions, or offers services in different countries.
Rapid Technology Change
Technology markets change quickly. Microsoft must continue updating its products while responding to new computing methods, customer needs, and competitors.
A company can spend heavily on a technology that develops more slowly than expected or is replaced by another approach.
Dependence on Complex Infrastructure
Cloud services depend on data centers, electricity, computer chips, telecommunications networks, and specialized equipment.
Shortages, construction delays, equipment failures, or higher energy costs could affect service capacity and expenses.
Product and Software Quality
Software errors can lead to outages, security problems, customer disruption, and repair costs. The risk can be significant when a product is widely used by businesses or governments.
Acquisitions and Business Integration
Microsoft may acquire other companies to add technology, employees, content, or customers. Acquisitions can be expensive and difficult to integrate.
The expected benefits may take longer to appear or may not fully develop.
Gaming and Consumer Preferences
Entertainment preferences can change rapidly. A game or device may perform differently from expectations, and customers can move their time and spending to competing platforms.
Beginner Terms in This Article
- Stock: A unit of ownership in a public company.
- Ticker: A short code used to identify a stock. Microsoft’s ticker is MSFT.
- Stock exchange: A marketplace where shares are listed and traded. MSFT is listed on Nasdaq.
- Revenue: Money generated from selling products and services before expenses are subtracted.
- Earnings per share: The portion of a company’s profit assigned to each share under accounting rules.
- Diluted EPS: Earnings per share calculated using a share count that includes certain securities that could become common shares.
- Fiscal year: A 12-month period a company uses for financial reporting. It does not always match the calendar year.
- Subscription: A payment arrangement that gives a customer continued access to a product or service.
- Cloud computing: The delivery of computing power, storage, software, and other technology through the internet.
- SEC: The U.S. Securities and Exchange Commission, the federal agency that oversees U.S. securities markets and public-company filings.
FAQ
What does Microsoft do?
Microsoft provides software, cloud computing, business applications, artificial intelligence services, cybersecurity products, gaming services, advertising, and computing devices.
What is Microsoft’s stock ticker?
Microsoft’s stock ticker is MSFT. Investors use this code to identify the company’s shares.
Where is Microsoft stock traded?
Microsoft stock is traded on the Nasdaq Stock Market.
How does Microsoft make money?
Microsoft earns money from subscriptions, cloud usage fees, software licenses, gaming, advertising, hardware, technical support, and consulting services.
What is the difference between Microsoft’s revenue and EPS?
Revenue is the money Microsoft generates before expenses are deducted. EPS shows the portion of profit assigned to each share. A company can increase revenue without increasing EPS if its costs rise quickly.
What should a beginner watch when learning about Microsoft?
Important areas include cloud demand, subscription growth, artificial intelligence spending, data center costs, competition, cybersecurity, regulation, and customer retention. Beginners should also check Microsoft’s latest SEC filings because financial information changes over time.
Key Takeaway
Microsoft is a large technology company identified by the ticker MSFT. It earns money from software subscriptions, cloud services, licenses, gaming, advertising, devices, and support.
For the fiscal year ended June 30, 2026, Microsoft reported $331.839 billion in revenue and diluted EPS of $17.95. These are historical annual results, not predictions of future performance.
A beginner studying Microsoft should understand both its broad product range and its risks. Competition, cybersecurity, regulation, infrastructure costs, economic conditions, and rapid technology change can all affect the business.
Sources
- U.S. Securities and Exchange Commission Company Facts: Microsoft Corp, CIK 0000789019. Used for company identity and the fiscal 2026 annual revenue and diluted EPS figures filed on July 29, 2026.
Disclaimer
This article is for general educational and informational purposes only. It is not investment, financial, legal, or tax advice. It is not a recommendation or solicitation to buy, sell, or hold Microsoft stock or any other security or financial product.
Financial results, company information, products, regulations, and market conditions can change over time. Investing involves risk, including the possible loss of principal. Readers should verify current information through official SEC filings, company investor materials, and other reliable sources.
Before making an investment decision, readers should consider their own circumstances, objectives, and risk tolerance. Professional financial, legal, or tax guidance may be appropriate when needed.
Image Notice: Images in this article may be AI-generated educational illustrations. They are provided for visual explanation only. They should not be interpreted as exact representations of real companies, people, products, documents, financial data, or investment outcomes.