Microsoft closed its fiscal year on June 30 with a quarter that showed just how unpredictable its AI investments can be. The company recorded a $3.2 billion gain on its stake in Anthropic and a roughly $600 million loss on its stake in OpenAI in the same three-month period. Together, those two items created a net gain of about $2.6 billion that showed up directly on Microsoft's profit report (TechCrunch, 2026-07-29).

The Anthropic gain added $0.33 to Microsoft's earnings per share for the quarter. The OpenAI loss subtracted about $0.07. Microsoft reported quarterly earnings of $4.81 per share, on $90 billion in revenue and $35.8 billion in profit (TechCrunch, 2026-07-29).

For the full year, the story is reversed. The OpenAI stake generated a $5 billion gain over the course of fiscal year 2026, adding $0.67 to the annual earnings per share of $17.95. Microsoft's full-year revenue was $331.8 billion with profit of $133.7 billion. The quarterly loss on OpenAI simply trimmed some of the gains recorded earlier in the year (TechCrunch, 2026-07-29).

The OpenAI investment's value bounced around a lot over the four quarters. In the first quarter, losses from the OpenAI stake reduced Microsoft's profit. The second quarter brought a sharp turnaround: gains from OpenAI added $7.6 billion to profit, alongside revenue of $81.3 billion, up 17% from the same period a year earlier (Microsoft Investor Relations, 2026-01-28). The third quarter saw losses again. Then the fourth quarter delivered the $600 million hit.

Why do these numbers swing so much? Microsoft uses an accounting method called mark-to-market. Think of it like checking the estimated value of a house you own each quarter. The house hasn't been sold, and no money has changed hands, but the estimated price goes up or down based on what similar homes are selling for and what an appraiser thinks. Microsoft does the same thing with its OpenAI stake, adjusting the recorded value up or down each quarter based on its best estimate of what that investment is worth at that moment.

Microsoft invested $5 billion in Anthropic in November 2025 as part of a partnership that also involved Nvidia (Microsoft Blog, date unknown). As part of the deal, Anthropic agreed to buy $30 billion worth of Microsoft's Azure cloud services. The $3.2 billion quarterly gain on that investment, recorded less than a year after the initial payout, reflects a big increase in Anthropic's estimated value between November and the June 30 fiscal year close. Microsoft does not update the value of its Anthropic investment every quarter, but it does report on its OpenAI investment quarterly (TechCrunch, 2026-07-29).

Microsoft owns about 27% of OpenAI (OpenAI, date unknown). On October 28, 2025, Microsoft filed a formal disclosure with the SEC, the government agency that oversees public companies, regarding a blog post titled "The next chapter of the Microsoft-OpenAI partnership," signaling an updated framework for the relationship (SEC, 2025-10-28).

The way these investments are accounted for matters for anyone trying to understand Microsoft's financial results. The OpenAI stake's value adjustments have shifted Microsoft's profit by billions of dollars in either direction across consecutive quarters, and those changes show up in earnings per share without any actual cash moving in or out. A quarter that shows a $7.6 billion gain from OpenAI followed by a quarter showing losses from the same investment does not mean OpenAI's business got better and then worse. The swings reflect changes in the estimated value of a privately held company, driven by factors like new funding rounds, how similar companies are valued, and Microsoft's own assessment of what the stake is worth.

The Anthropic situation works differently because Microsoft does not update that investment's value every quarter. The $3.2 billion gain appeared because the November 2025 investment was being valued for the first time at the end of the fiscal year, and the increase was large enough to add $0.33 to earnings per share on its own. Future quarters may or may not bring similar Anthropic adjustments; the company has chosen not to clarify whether it will.

The practical takeaway is that Microsoft's reported earnings now include a layer of volatility from its investment portfolio that is separate from how its actual businesses, like Azure cloud services and Microsoft 365 software, are performing. The $90 billion quarterly revenue and $331.8 billion annual revenue reflect the company's day-to-day operations. The gap between those operating results and the final profit number is where the AI investment adjustments sit, and that gap has been wide enough in several quarters to make a real difference on a $133.7 billion annual profit base.

The bigger question for investors and analysts is whether these investment gains and losses are temporary, reflecting the early stage of Microsoft's Anthropic position and the still-settling value of OpenAI, or whether they will be a permanent feature of owning large stakes in private AI companies. Microsoft has structured both relationships to support its Azure business: the $30 billion cloud services commitment from Anthropic and the OpenAI partnership's infrastructure arrangement connect the investment strategy to cloud revenue growth, not just the value of the stakes themselves. Whether the gains settle down as these companies mature or keep swinging with private-market valuations will show up in the quarterly reports, at least for OpenAI.