Microsoft Q3: 30% Discount Happens Rarely, I'm Buying

Microsoft reported its eighth consecutive record quarter, with Q3 revenue of $82.9B (+18% YoY) driven by strong cloud and AI adoption. Microsoft Cloud revenue was $54.5B (+29%), and AI-related revenue is annualizing at over $37B (+123%). The company incurred elevated capital expenditures ($32B this quarter; $190B FY), but management expects operating execution to remain strong and margins to improve in FY26. The stock trades at a ~21.4x forward P/E, noted as more than 30% below its historical average, supporting the author’s long-term buy thesis. Overall, the results and AI/multi-cloud momentum are presented as bullish for MSFT’s fundamentals and long-term valuation, despite near-term heavy CapEx.