Microsoft vs. Meta Platforms: A Comparative Analysis of Their Q3 Earnings Reports
In July 2026, both Microsoft and Meta Platforms released their quarterly earnings reports on the same day but saw divergent market reactions. Microsoft's stock rose over 15% following its strong fiscal fourth-quarter results for FY2026 (ended June 30), driven by a solid revenue increase of $332 billion year-over-year, an 18% growth in earnings per share to $17.28, and prudent capital expenditure planning that boosted investor confidence. In contrast, Meta Platforms' stock fell over 9%, despite reporting Q2 revenue up 28% to $60.8 billion. The drop was attributed to a significant decline in net income (down 14%) and free cash flow, which plummeted from $8.55 billion to just $784 million due to aggressive AI infrastructure spending. Meta's earnings per share of $6.18 also missed the consensus estimate by nearly $1. The contrasting outcomes highlight Microsoft’s disciplined approach in managing its capital expenditures and maintaining strong cash flow, while Meta faces investor concerns over short-term profitability amid heavy investments.
Topics: AI infrastructure investment Meta Platforms Microsoft S&P 500