Microsoft announced its fourth quarter earnings for fiscal 2026 (ending June 30) and provided an interesting tidbit about how its investments in its two largest and competing AI labs are faring.
During the quarter, investments in Anthropic recorded gains of $3.2 billion, increasing diluted earnings per share by 33 cents. (Microsoft reported diluted earnings per share of $4.81 for the quarter.) Microsoft invested $5 billion in Anthropic in November 2025 as part of a revolving deal in which the AI lab agreed to purchase $30 billion worth of Azure services.
Microsoft does not regularly update the value of its Anthropic investments on a quarterly basis. However, we discuss OpenAI investments quarterly. Microsoft said its investments weren’t great this quarter, cutting about $600 million and diluted EPS falling about 7 cents per share.
Microsoft owns about 27% of OpenAI. Microsoft also receives revenue-sharing payments, but does not report how much OpenAI pays under that agreement. Instead, Microsoft calculates the value of your investment. Although the value of that investment declined significantly this quarter, the $600 million write-down was still a rounding error on Microsoft’s part. The company had a very profitable quarter, reporting $90 billion in revenue and $35.8 billion in net income for the quarter. Microsoft’s revenue was $331.8 billion and net profit was $133.7 billion.
Microsoft’s OpenAI investments look much better on a year-to-year basis.
This year, Microsoft’s investment in OpenAI generated $5 billion in profits and added $0.67 to EPS, the company reported. (Microsoft reported $17.95 EPS for the fiscal year.) Still, it’s notable that Microsoft reported almost as much profit from Anthropic for the quarter as it did from OpenAI for the year. It’s very noteworthy that Microsoft actually released this.
