Microsoft (MSFT) stock fell 2.9% despite beating Q1 earnings and revenue expectations. The drop was due to higher capital expenditure outlook for 2026. ETF investors can capitalize on Microsoft’s growth potential through funds like IYW, TOPT, XLK, VGT, and FTEC.

Microsoft’s Q1 results exceeded expectations with a 13.2% beat in EPS and 3.6% in revenues. Revenue growth was driven by increased demand for cloud and AI services. The company returned $10.7 billion to shareholders and ended the quarter with $102.01 billion in cash and investments.

Microsoft is strengthening its partnership with OpenAI, expecting significant revenue opportunities. For Q2 2026, Microsoft anticipates revenue growth of 14-16% and 37% growth for Azure. The company remains capacity-constrained till at least the end of fiscal 2025.

ETFs heavily exposed to Microsoft like IYW, TOPT, XLK, VGT, and FTEC offer diversified exposure to the tech giant’s growth potential. These funds have performed well year-to-date and hold favorable Zacks ETF rankings. Consider these ETFs for potential investment opportunities.

Read more at Nasdaq: ETFs to Buy as Microsoft’s Shares Slide Despite Q1 Earnings Beat