Microsoft reported a 19% revenue increase in its MSFT Dynamics 365 business applications suite for Q2 of fiscal 2026, which ended on December 31, 2025. This surge contributed to the broader Productivity and Business Processes segment, which generated $34.1 billion in revenues with a 60% operating margin. Microsoft has been integrating AI features, such as the Payables Agent for automating vendor invoice processing and the Expense Management Agent for handling approvals, into its Dynamics 365 platform.
For Q3 2026, Microsoft anticipates continued Dynamics 365 revenue growth in the high teens. Competition remains strong, with Oracle‘s Fusion Cloud ERP showing a 17% revenue growth and Salesforce reporting a 9% increase in the last quarter. Notably, Microsoft’s Dynamics 365 is outpacing its rivals in growth rates.
Microsoft’s stock has seen a 21.2% decline over the past six months, slightly outperforming the sector. The fiscal 2026 earnings estimate stands at $16.97 per share, indicating a 24.41% year-over-year growth.
