Microsoft Booked $3.2bn From Anthropic, Gained on OpenAI

Microsoft Made $3.2 Billion on Anthropic. The OpenAI Number Was Also a Gain.

A widely repeated report described a $600 million OpenAI markdown in Microsoft's fourth quarter. Microsoft's own reconciliation shows the opposite — a $480 million gain — and the Anthropic windfall sits inside the adjusted earnings that beat consensus.

On Microsoft's 29 July earnings call, finance chief Amy Hood disclosed "a $3.2 billion gain from our investment in Anthropic" in the fourth quarter. Coverage that followed reported the OpenAI stake as a $600 million markdown. That is backwards.

What the reconciliation shows

Fourth-quarter GAAP net income of $35,766 million less an OpenAI adjustment of $(480) million gives $35,286 million adjusted; diluted EPS of $4.81 less $(0.07) gives $4.74. Subtraction means the GAAP result contained a $480 million OpenAI gain that non-GAAP removes. The prior-year quarter runs the other way — GAAP $27,233 million plus $1,575 million — which is what a real loss looks like in the same table. Across fiscal 2026 OpenAI added $4,963 million and $0.67, against negative $3,620 million a year earlier.

The two stakes are accounted for differently

OpenAI is equity method — roughly 27% as-converted against a $13 billion commitment — so Microsoft books its share of results plus ownership-change effects, not a mark-to-market of the stake. The fiscal-2026 swing owes largely to the October 2025 recapitalisation, where Microsoft's percentage fell while the implied valuation rose far faster. Anthropic is not revalued quarterly; gains arise when proportionate ownership changes. The likely trigger this quarter: Anthropic's $65 billion Series H at roughly $965 billion post-money in May 2026.

The part worth noticing

Microsoft's non-GAAP adjustment removes only OpenAI. The $3.2 billion Anthropic gain stays inside the $4.74 adjusted EPS that beat consensus near $4.24 — a one-off investment gain sitting within the headline beat.

Why It Matters

Microsoft's earnings now carry material swings from stakes in two competing labs, accounted for two different ways, in a line item most readers skip. When a quarter's beat partly reflects a rival's funding round rather than software sold, the distinction between operating performance and portfolio revaluation stops being pedantry.