10:31 AM EDT, 07/18/2025 (MT Newswires) -- Microsoft ( MSFT ) will likely deliver strong fiscal Q4 results on July 30 after reporting better-than-expected fiscal Q3 Azure results in April, Deutsche Bank said in a note Friday.

The catalysts for the company's revenue outperformance will be a "not overly demanding Azure setup, more resilient PC shipments, rebounding sentiment and activity post April tariff uncertainty," the note said.

Also, the company may also see year-on-year expansion for its operating margin and EPS upside backed by factors including "well above seasonal OpEx growth despite constrained headcount growth and AI savings," Deutsche said.

For 2026, Microsoft's ( MSFT ) management will likely "directionally guide to another year of double-digit [year on year] revenue and operating income growth, as it has in recent years," the note said.

According to Deutsche, the 2026 consensus estimates for 13% year on year revenue growth are underestimating the "resiliency of Azure demand, the signal being sent around mix shifting back toward shorter-lived assets within still growing overall CapEx, and rebounding non-AI Azure activity that started to show last quarter and seem to be strengthening in our recent checks."

Deutsche has a buy rating on Microsoft ( MSFT ) and $550 price target.

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