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Microsoft posts strong Q3 2026 growth with 18.3% revenue rise and rapid AI adoption, seen as undervalued stock.

Company Fundamentals
29 May 2026
Seeking Alpha
View Source
Bullish
pluang ai news

Microsoft reported robust Q3 2026 results, with revenue up 18.3% and earnings per share growing 20.6%, driven by rapid adoption of AI technologies like Copilot, which saw a 250% increase in paid seats year-over-year. The stock trades at a forward P/E of 21.5, below its 10-year average, and is estimated to be 23% undervalued with a fair value target of $534. Despite risks from heavy OpenAI exposure and uncertain enterprise returns on Copilot, Microsoft's strong cash flow, dividend growth, and solid balance sheet support a positive long-term investment outlook.

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