Microsoft reported better than expected results and issued a strong forecast for its Azure cloud unit, but key issues remained. The company's Q3 results were met with muted trading, with revenue rising 18% year over year to $82.89 billion, beating the LSEG consensus estimate of $81.39 billion. However, concerns about the viability of highly profitable seat-based software business models were not resolved. Microsoft's reliance on OpenAI for Azure growth was seen as a weakness rather than a weapon, and concerns were raised about the company's capacity constraints and the quality of its Copilot AI assistant. Despite this, Microsoft's stock has been the worst-performing stock in the Magnificent Seven over the past six months. Despite these positives, Microsoft CFO Amy Hood stated that the company expects to spend about $190 billion in capex in calendar 2026, implying almost $120 billion year-over-year growth. The firm also indicated it is increasing its capital expenditures to bring more AI computing capacity online to meet demand from external customers and reduce reliance upon OpenAI's intellectual property.