In case you missed it:

• Meta & Robinhood Earnings Reviews.

• Alphabet & Tesla Earnings Reviews.

• SoFi & PayPal Earnings Reviews.

• Chipotle Earnings Review.

• ServiceNow Earnings Review.

• Netflix & Taiwan Semi Earnings Reviews (from two weeks ago).

• Portfolio Earnings Season Preview.

• Updated Holdings & Performance as of Today.

Table of Contents

• 1. Apple (AAPL) — Brief Earnings Snapshot

  • a. Demand

  • b. Profits

  • c. Balance Sheet

  • d. Guidance & Valuation

• 2. Microsoft (MSFT) — Detailed Earnings Review

  • a. Key Points

  • b. Demand

  • c. Profits & Margins

  • d. Balance Sheet

  • e. Guidance & Valuation

  • f. Call & Release

  • g. Take

• 3. Amazon (AMZN) — Detailed Earnings Review

  • a. Key Points

  • b. Demand

  • c. Profits & Margins

  • d. Balance Sheet

  • e. Guidance & Valuation

  • f. Call & Release

  • g. Take

1. Apple (AAPL) — Brief Earnings Snapshot

a. Demand

• Beat revenue estimates by 5.5% & beat guidance.

• Beat product revenue estimates by 6.1%.

  • iPhone beat estimates by 11%

  • Mac beat estimates by 10%.

  • iPad missed estimates by 7%.

  • Wearables, Home and Accessories missed estimates by 5%.

  • China revenue was 1.2% ahead of expectations.

• Beat services revenue estimates by 2%.

b. Profits

• Beat 46% GPM estimates & beat 46% guidance by 50 basis points (bps; 1 basis point = 0.01%) each.

• Beat EBIT estimates by 9.7% & beat guidance by ~10%.

• Beat $1.43 EPS estimates by $0.14.

• Beat free cash flow (FCF) estimate by 6.7%.

c. Balance Sheet

• $56B in cash & equivalents.

• $78B in non-current marketable securities.

• $92B in total debt.

• Share count fell by 2.6% Y/Y.

d. Guidance & Valuation

• Low-to-mid single digit revenue growth guidance was roughly in line with 3% growth estimates.

• 46% GPM guidance was also in line with estimates.

• Assuming their revenue growth guidance means 3% Y/Y, EBIT guidance was very slightly ahead of estimates.

• If we make the same assumption about their revenue growth guidance, EPS guidance is roughly in line with $1.66 estimates.

Apple trades for 29x forward EPS. EPS is expected to grow by 6% this year and by 9% next year. Estimates should rise a bit following the report.

I will have the rest of the review published on Saturday. This looks like Apple’s best quarter in over a year just based on the numbers. I need to read the transcript before I comment more.

2. Microsoft (MSFT) — Detailed Earnings Review

a. Key Points

• Great Azure performance — especially for non-AI workloads.

• Continued rapid uptake of data products.

• Record quarter for commercial bookings.

• The CapEx spending spree will continue next quarter and is tied to near-term demand signals.

b. Demand

• Beat revenue estimates by 3.4% & beat guidance by 3.7%.

  • Foreign exchange was as expected and did not contribute to the beat.

  • Productivity & Business Processes (PBP) FX neutral (FXN) growth was 13% vs. 11.5% guidance and 15% estimates.

    • Microsoft Consumer Cloud revenue beat internal expectations and Commercial Cloud trends were called “stable.”

  • Intelligent Cloud FXN growth was 22% Y/Y vs. 21% growth expected.

  • More personal compute FXN growth was 7% Y/Y vs. 3% growth expected.

• Beat 34.5% foreign exchange neutral (FXN) Azure growth estimates & guidance by 4.5 points each.

• Commercial bookings rose 37% Y/Y (30% FXN) and beat internal expectations. This was helped by great large deal momentum for Azure.

c. Profits & Margins

• Beat EBIT estimates by 6.8% & beat guidance by 7.3%.

  • OpEx rose by 6% Y/Y. The EBIT beat was powered by revenue outperformance and cost controls.

• Beat $3.37 GAAP EPS estimates by $0.28.

  • EPS rose by 24% Y/Y.

• Beat FCF estimates by 21%.

• Microsoft Cloud GPM fell 2 points Y/Y due to Azure infrastructure buildouts, though this was offset by some Azure efficiency gain.

d. Balance Sheet

• $94B in cash & equivalents.

• $40B in debt.

• Slight Y/Y share count reduction.

• 11% Y/Y dividend growth.

e. Guidance & Valuation

• Q1 revenue guidance beat estimates by 1.4%.

• Q1 EBIT guidance beat estimates by 3.5%.

• Q1 cloud GPM is expected to fall to 67% due to more infrastructure spending.

They also see more than $30B in Q1 CapEx. 50% of this is tied to short-lived assets like servers to meet near-term demand signals. Customer interest continues to soar, and they need to spend to meet their $368B backlog. The spending is “highly correlated” with revenue opportunities in the coming quarters, which greatly diminishes the risk of poor ROI and wasted money altogether. While they thought they’d alleviate supply constraints by this June, that has now been pushed back to December, as they continue to have a hard time keeping up with demand. That’s good news for the demand runway.

For the full year, they expect 10%+ revenue and EBIT growth, as well as stable Y/Y operating margins. This led to revenue and EBIT estimates for next year modestly rising. 

• Growth during the first half of FY 2026 will be higher than the second half due to timing of capacity coming online.

f. Call & Release

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