MSFT & META Earnings Tonight: The Only Numbers That Matter
Microsoft and Meta report after the bell July 29. Azure growth and capex guidance will decide whether MSFT's 20% YTD loss deepens or reverses.
Key Points
- Microsoft consensus sits at EPS of $4.24 on $87.62B revenue, but the FY2027 capex projection of $255B–$260B is the number that could crater or lift the stock after hours.
- Meta raised its 2026 capex forecast to $125B–$145B and just committed to a $14B Texas data center with BlackRock — investors will judge whether the spending is disciplined or out of control.
- Watch Azure's sequential growth commentary on the MSFT call and any hard timeline on Meta's Iris chip for the clearest signals on where both stocks open Thursday.
Two of the most consequential earnings calls of 2026 drop tonight after 4 PM ET — Microsoft and Meta Platforms, both of them down double digits year-to-date, both of them sitting on capex commitments that dwarf anything Wall Street has previously absorbed from a single quarter's guidance. The numbers themselves will matter less than what management says comes next.
The Trap Microsoft Already Sprung Once
Microsoft enters tonight's print in a hole of its own making. The stock is down 20.7% year-to-date, and the culprit isn't revenue — it's the market's reaction to what revenue growth requires. In Q3, MSFT beat cleanly on both lines: revenue of $82.89B against the $81.39B estimate, EPS of $4.27 against $4.06 consensus. The stock still fell sharply after the call, because the company outlined roughly $190B in capex for calendar 2026 with FY2027 projections heading toward $255B–$260B. When you're spending that much to build the infrastructure that drives your growth, the question stops being "did you beat?" and starts being "when does the return show up?"
Tonight's consensus is EPS of $4.24, up 16.2% year-over-year, on revenue of $87.62B, a 14.6% YoY gain. Those are achievable numbers — MSFT has beaten EPS estimates in each of the last four quarters by an average of roughly 5%. The real binary is Azure. The cloud segment has been posting growth in the high-30% range, and any deceleration below that — say, 36% or 37% — will be read as a demand signal, not an execution issue. The counter-argument is that AI workload migration onto Azure is still early-innings, and several hyperscaler checks from enterprise IT spending surveys conducted in June suggested no slowdown in multi-year cloud commitments. But surveys and results are different things.
The capex question will dominate the Q&A. With $255B–$260B projected for FY2027, Microsoft is essentially telling investors it will spend more than the GDP of Portugal next year building data centers, networking infrastructure, and GPU clusters. The bull case is straightforward: you cannot serve $100B+ in annual cloud revenue without the pipes. The bear case is that at a 10-year Treasury yield of 4.65%, capital is not cheap, and the market is being asked to underwrite a multi-year ROI story while inflation is still running at 3.5% YoY and real rates remain positive. Microsoft's free cash flow discipline — or lack thereof — will be the subtext of every analyst question tonight.
Meta's Spending Problem Comes With a New Variable
Meta's setup is different in character but similar in structure. Consensus EPS is $7.19 on $60.22B in revenue, implying 26.7% top-line growth year-over-year. The advertising engine has been running hot — Meta's engagement metrics across Facebook, Instagram, and WhatsApp have held up better than most skeptics expected through 2025 and into 2026, and Reels monetization has closed much of the gap with TikTok's CPM rates. Revenue is not the concern. The concern is what happens to the margin profile when you are simultaneously running one of the world's most profitable ad platforms and committing to a capex range of $125B–$145B for 2026 — a figure that was itself raised from the prior guidance of $115B–$135B.
The BlackRock deal announced Tuesday is the most important piece of corporate context heading into tonight's call. Meta and BlackRock are building a 1-gigawatt, $14B data center in Texas, with BlackRock taking an 80% equity stake and Meta retaining 20%. Read that structure carefully: Meta gets access to 100% of the compute while booking only 20% of the capital liability. It is a balance-sheet engineering move disguised as a real estate transaction — the same logic private equity has used to fund industrial assets for decades, now applied to AI infrastructure. If management can credibly articulate that this is the template for future build-outs, the capex overhang that has weighed on the stock — down nearly 10% YTD and roughly 16% over the last 12 months — starts to look less like a margin drain and more like a funded growth plan with off-balance-sheet leverage.
The Iris chip is the wildcard no analyst model has fully priced. Meta's in-house AI accelerator is expected to enter production in September, and any update on yield rates, deployment timelines, or cost-per-FLOP comparisons to NVIDIA's current-generation hardware will matter enormously. If Iris performs as internally projected, Meta reduces its dependence on NVIDIA — a supplier relationship that has given Nvidia extraordinary pricing power over every hyperscaler. A credible Iris update tonight is a stealth negative for NVDA and a genuine long-term positive for META's operating leverage.
What Traders Watch Next
The setup for both stocks is asymmetric in an important way: disappointment is more actionable than a beat. MSFT has already been punished for a quarter in which it beat estimates — the market's reaction function has shifted from "did you hit the number?" to "can you justify the spending?" A second consecutive capex shock, defined as FY2027 guidance above $260B or any suggestion that Azure growth is moderating toward 34%–35%, likely sends MSFT toward the $390–$395 range in Thursday's session. A clean beat with stable capex and strong Azure commentary — say, 39% or 40% growth — could push the stock back toward the $440 area it held in early May before the last leg down.
For Meta, the margin trajectory is the trader's compass. Operating margins came in at roughly 41% in Q1 2026; a print below 39% tonight on the back of elevated infrastructure spend will be treated as evidence that the capex cycle is consuming returns faster than the ad business can regenerate them. A margin hold above 40% — especially if paired with a credible Iris production update and any language suggesting the BlackRock structure is replicable — could be the catalyst that lifts META back through the $600 level it has failed to reclaim since May.
Options markets are pricing significant moves in both names for Thursday's open — the implied moves embedded in tonight's options suggest approximately 5%–7% in either direction for MSFT and 6%–8% for META. With 300 companies reporting on July 29 alone, index direction will be set by these two prints more than any other single input. The specific number to watch on the MSFT call is FY2027 capex — if Satya Nadella frames it as "approximately $255B–$260B," the reaction will be measured; if the range moves higher, the tape will not forgive it. On the META call, watch for Zuckerberg's language around the BlackRock deal — if he describes it as a "model" or "framework" for future data center financing, that single word could reframe the entire capex narrative before markets open Thursday morning.
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