MSFT · 10-Q · 2026Q3 · Full report

Operating Expense Trends

MICROSOFT CORP · 2026-10-28 · Importance 24 · Surprise 14

Total operating expenses increased $975 million, or 6%, to $16.644 billion, driven by continued investment in research and development compute capacity and talent; total company headcount decreased 2%. Research and development expense rose 11% to $9.047 billion, an increase of $901 million, while sales and marketing expense was essentially unchanged at $5.716 billion. General and administrative expense increased 4% to $1.881 billion. Agents and Infra operating expenses rose 10% to $12.350 billion, while Devices and Consumer operating expenses declined 3% to $4.294 billion.

Key facts

• Microsoft Agents and Infra operating expenses increased $1.1 billion, or 10%, due to continued investments in research and development compute capacity and talent. source
• Microsoft operating expenses increased $975 million, or 6%, in Q1 FY2027, while research and development expenses increased $901 million, or 11%, due to continued investment in compute capacity and talent. source
• Microsoft operating expenses increased $975 million, or 6%, driven by continued investments in research and development compute capacity and talent; total company headcount decreased 2%. source