Microsoft Has $364.6 Billion Of Datacenter Leases Not Yet Started, Up From $196.6 Billion In March
Microsoft's quarterly report shows signed datacenter leases running to fiscal 2034 as cash and short-term investments fell to $64.5 billion.
Microsoft has signed $364.6 billion of additional datacenter-heavy leases that have not yet begun, nearly double the $196.6 billion it reported in its April quarterly filing, its 10-Q filed Wednesday shows. The commitments sit beside capital spending that doubled from a year earlier and a cash pile that shrank.
Leases stretch out to fiscal 2034
The leases, primarily for datacenters, will start between fiscal 2027 and fiscal 2034, with terms of 1 to 20 years, and some depend on contractual conditions being met. The earlier filing, for the quarter ended March 31, had them commencing between fiscal 2026 and fiscal 2031.
Leases already running are growing too. Finance lease liabilities stand at $70.97 billion, from $66.59 billion at June 30, and operating lease liabilities reached $27.5 billion.
Microsoft, the software and cloud giant behind Windows, Microsoft 365 and Azure, now reports two segments, with a new Agents and Infra unit combining applications, agents and Azure infrastructure.
Spending doubles while cash falls
Additions to property and equipment reached $39.4 billion in the September quarter, against $19.4 billion a year earlier. Net cash from operations rose to $58.0 billion from $45.1 billion.
Cash, cash equivalents and short-term investments totaled $64.5 billion at September 30, down from $76.8 billion at June 30. Receivables tied to buying server components climbed to $35.7 billion from $27.8 billion.
Microsoft still expects cash, operating cash flow and capital-market access to fund its needs for at least the next 12 months and beyond.
Revenue supports the build-out
Revenue rose 19% to $92.3 billion, and Azure revenue climbed 48%, the earnings release said. Commercial remaining performance obligation, contracted revenue not yet recognized, rose 73% to $677 billion, with about 30% expected to be recognized over the next 12 months.
The risk language is firmer on the cost side. The annual report already described the investments as running ahead of fully developed revenue and warned that overestimating demand could lead to asset impairments; the 10-Q repeats that.
Microsoft's market value was $3.95 trillion at Wednesday's report time, and the $364.6 billion of leases still has to move onto its books as each one begins.
Sources
- 10-Q Filing — Microsoft (MSFT) — SEC EDGAR
- 10-Q Filing — Microsoft (MSFT), Q3 FY2026 filed 2026-04-29 (comparison basis) — SEC EDGAR
- 10-K Filing — Microsoft (MSFT), filed 2026-07-29 (earlier disclosure) — SEC EDGAR
- Earnings release (8-K Item 2.02, msft-ex99_1.htm) — Microsoft, filed 2026-10-28 — SEC EDGAR
- 8-K Filing — Microsoft, filed 2026-10-28 (Items 8.01, 9.01) — SEC EDGAR
- Microsoft (MSFT) Q1 earnings report 2027 — CNBC
- Microsoft Non-GAAP EPS of $4.89 beats by $0.17, revenue of $92.28B beats by $1.54B (MSFT:NASDAQ) | Seeking Alpha — seekingalpha.com
- Microsoft (MSFT) Cloud Sales Top Estimates With 48% Azure Growth - Bloomberg — Bloomberg
- Here’s How Much Microsoft Stock Is Expected to Move After Earnings — investopedia.com
- Microsoft: Fiscal Q1 Earnings Snapshot — Associated Press
