Observed Signal · Apr 30, 2026 · Earnings Report · Source: CNBC Technology · Impact: 4/5 · Sentiment: Neutral
Jim Cramer Criticizes Microsoft Q1 Despite Strong Azure
CNBC commentator Jim Cramer expressed disappointment with Microsoft’s latest quarter, saying the report “was not joyous” and reiterating he had no interest in buying the stock. Microsoft delivered better-than-expected results and issued strong guidance for Azure — forecasting 39%–40% growth and reporting cloud revenue above $54 billion (up 29% year over year) — but Cramer said other aspects of the business felt more like traditional software and flagged concerns about Office’s seat-based model being threatened by AI code-writing. Shares fell about 5% after the report and were down over 16% year-to-date. Cramer ranked Microsoft near the bottom among peers Alphabet, Meta and Amazon in recent earnings.
Microsoft is a major hyperscaler and enterprise platform; its Azure guidance and cloud revenue materially affect cloud infrastructure, AI capacity and enterprise software markets that broadly influence AdTech/MarTech vendors and platform economics.
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Key Takeaways & Evidence Grounding
- Jim Cramer publicly criticized Microsoft’s quarterly report and said he had no interest in buying Microsoft shares following the results.
- Microsoft forecasted Azure cloud growth between 39% and 40%, above Wall Street consensus of about 37%.
- Microsoft reported cloud revenue of over $54 billion for the quarter, a 29% year‑over‑year increase.
- Microsoft’s shares fell roughly 5% after the report and were down more than 16% year‑to‑date.
- Cramer ranked Microsoft’s performance near the bottom relative to Alphabet, Meta and Amazon after their recent earnings; he placed Meta last.
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Cramer: Microsoft Selling to Fund AI Picks Won't Last
Jim Cramer said on CNBC that investors rotating out of Microsoft to buy higher‑flying AI-related stocks is a temporary dynamic. He continues to hold Microsoft in his Investing Club Charitable Trust, arguing the company will respond to pressures around its enterprise software 'seat' business and improve Copilot. The article cites Microsoft’s recent quarter (Productivity and Business Processes revenue of $35.01B, Intelligent Cloud revenue of $34.68B), a 14.5% year‑to‑date decline in the stock, guidance for Azure/cloud growth of ~39–40%, and Microsoft reporting over 20 million paid Microsoft 365 Copilot seats. Goldman Sachs is noted as more bullish with a higher price target, while Cramer’s Investing Club maintains a hold-equivalent rating and $500 target for MSFT.
Citi Backs Microsoft Copilot, Surprising Jim Cramer
Citi analysts issued a bullish research note on Microsoft’s Copilot and Azure, forecasting a strong fiscal 2026 Q4 and momentum into fiscal 2027 that could drive revenue and EPS growth through fiscal 2030. Citi reported stronger Copilot adoption from industry checks and raised Copilot estimates, forecasting M365 Copilot net adds of +8M versus +5M in Q3 and expecting higher-than-typical payback periods (PBP). Jim Cramer expressed surprise at Citi’s optimistic view on Copilot on CNBC, while also noting he found the analysts’ commentary on Azure reassuring. The piece also discusses investor concerns about AI disruption in enterprise software, Microsoft’s reliance on OpenAI, and pressure across cloud and software stocks.
Microsoft Q3 Beats Estimates; Azure Growth, Software Worries Persist
Microsoft disclosed during its fiscal Q3 2026 earnings call that M365 Copilot now has over 20 million paid enterprise seats, part of a quarter in which the company beat expectations. The company said it has quadrupled the number of customers buying more than 50,000 seats and highlighted large deployments at Bayer, Johnson & Johnson, Mercedes and Roche (each with >90,000 seats) and an Accenture deal for over 740,000 seats. Microsoft reported strong Copilot engagement — queries per user up nearly 20% quarter‑over‑quarter and weekly engagement matching Outlook — and emphasized multi‑model support (including Anthropic’s Claude) and intelligent model routing. Microsoft also announced Agent mode as the default across Copilot, Word, Excel and PowerPoint and said Copilot’s agentic capabilities were made generally available April 22, 2026. Analysts at Morgan Stanley called the Copilot numbers “super impressive.”
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