To The Moon

2025 Q4 Earnings Expectations

• $Microsoft(MSFT)$ Microsoft’s 2025 fiscal Q4 falls in the calendar Q2 of 2025.

• Azure is expected to show a year-over-year growth rate of 35.5% (with AI contributing 18%), exceeding the prior forecast of 34.2% (AI contribution 17%).

• Commercial Office business growth is projected to reach 13%, driven by upgrades to E3/E5 plans and the adoption of Copilot.

• Revenue for fiscal 2026 is forecasted to grow by 14%, consistent with fiscal 2025.

• Fiscal 2026 capital expenditures are projected to increase to $99.1 billion, but will remain around 31% of revenue.

How to Evaluate Microsoft’s Earnings Outlook

1. Since Q3, Microsoft’s stock price has risen by 30%, reflecting strong market confidence.

2. The earnings outlook is highly optimistic, with almost no negative sentiment.

3. Expected post-earnings stock volatility is 4.5%, with a projected range between $482 and $528.

Trading Strategy

• With no significant bearish catalysts, the stock is unlikely to break below the expected range. Consider selling put options.

• Sell put options before the earnings announcement and close the position at the market’s opening on the release day.

• For those holding Microsoft stock, sell out-of-the-money call options to earn additional income.

Strike Price and Expiration Suggestions

1. Covered Call Writing Strategy:

   • $MSFT 20250801 535.0 CALL$  (86% win rate).

2. Put Selling Strategy:

   • $MSFT 20250801 482.5 PUT$  (80% win rate).