Microsoft EPS Grew 32% or 18%? Adjust Both Years.

Original SignalSage two-year diluted-EPS matrix for Microsoft, USD per share. Three months ended September 30: 2025 GAAP 3.72 plus 0.41 OpenAI investment adjustment equals non-GAAP 4.13; 2026 GAAP 4.92 minus 0.03 equals non-GAAP 4.89. Issuer-rounded year-over-year growth is 32% GAAP and 18% non-GAAP. Adjust both years before comparing. October 28, 2026 release; November 2 Beijing review. No app calculation or forecast.

A small adjustment in the latest quarter can sit beside a much larger difference between two growth rates. Before interpreting an earnings headline, check whether the comparison year was adjusted too. Microsoft's latest results make that denominator check concrete.

The dates come first

This is a November 2, 2026 Beijing review of Microsoft's October 28 release, not a new announcement today. Fiscal first-quarter 2027 results cover the three months ended September 30, 2026, compared with the same quarter of 2025. The figures below are diluted earnings per share in U.S. dollars.

Read across both rows

Microsoft reports current GAAP EPS of $4.92 and adjusted non-GAAP EPS of $4.89. The reconciliation subtracts $0.03 for the impact from investments in OpenAI. The prior-year row runs the other way: GAAP EPS of $3.72 plus $0.41 gives adjusted EPS of $4.13. The current investment impact was a gain; the prior-year impact was a loss.

Then read down each column

The issuer reports year-over-year EPS growth of 32% on a GAAP basis and 18% on this non-GAAP basis. Those comparisons use different prior-year denominators: $3.72 and $4.13. Comparing only $4.92 with $4.89 misses the changed base. Both growth rates are rounded issuer figures; calculations from rounded EPS can differ slightly.

Keep the interpretation narrow

Do not describe the difference between the two growth rates as an exact percentage-point contribution from OpenAI. The starting bases differ. Removing an investment impact also does not turn the adjusted figure into revenue, operating cash flow, a cash receipt, or a forecast. The reconciliation tells you what was removed, not that the remaining profit will recur.

A four-cell research note

Draw a small table with years as rows and measurement definitions as columns. Put GAAP on one side and the issuer's adjusted measure on the other. Preserve the sign of each adjustment and its label. Only then compare one column across time. If a company changes its definition, look for recast comparative figures before calculating a trend.

Use a shortlist to ask a better question

After a stock screen, a practical next step is to save the reporting period, original release, both denominators, and the adjustment definition in your own research notes. A summary can help organize the task; it cannot replace the issuer's reconciliation. This is a suggested research workflow, not a newly demonstrated note-taking feature inside an app.

Continue the research

SignalSage by MerlaTech supports U.S. stock research. It has an English interface, and some features require in-app purchases or subscriptions. Use the iPhone and Android download hub below, or the Android campaign link. The existing screener walkthrough offers a separate starting point. This original diagram and explanation are AI-assisted; no stock-price prediction, return promise, or app calculation is presented.

Sources: Microsoft investor-relations reconciliation; Microsoft issuer announcement.

Download SignalSage for iPhone and Android · Android campaign link · Existing screener walkthrough.

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