Microsoft Revenue Reaches $92.3 Billion as Azure Grows 48%
Key Facts
Microsoft reported revenue of $92.3 billion in the first quarter of fiscal 2027, up 19% year over year, in results the company said exceeded expectations for revenue, operating income and earnings per share. Operating income was $45.9 billion, up 21%, while GAAP net income rose to $36.6 billion, up 32%. Diluted earnings per share were $4.92 under GAAP, up 32%, and $4.89 on a non-GAAP basis, which excludes the impact of OpenAI investments, up 18%. The results cover the three months ended September 30, 2026, according to the company’s statement. The statement did not provide the amounts of the analyst estimates the results exceeded.
Cloud was the strongest driver of the results, with Microsoft Cloud revenue reaching about $63.9 billion, up 30% year over year, or 31% excluding the impact of foreign-exchange movements. Chief Financial Officer Amy Hood said cloud revenue growth accelerated during the quarter, while Azure revenue rose 48%. Microsoft Cloud growth is a broader measure than Azure, combining revenue from the company’s cloud services, while the Azure figure reflects growth in the service itself. In the fourth quarter of fiscal 2026, Microsoft Cloud revenue was about $59.3 billion, up 27%, and revenue from Azure and other cloud services rose 43%. The comparison shows Microsoft Cloud growth rising from 27% to 30%, and growth in Azure and other cloud services from 43% to 48%.
Microsoft’s commercial remaining performance obligations rose 73% to $677 billion, according to the company’s statement. The metric refers to contractual obligations not yet fulfilled, rather than revenue the company recorded in the quarter. At the product level, commercial Microsoft 365 cloud revenue increased 17% on a reported basis, or 18% in constant currency. After adjusting for the effect of a one percentage point of revenue recognition in the year-earlier comparison period, growth was 18%, or 19% in constant currency. The company’s figures distinguish reported from adjusted growth, as well as the effects of currency and the year-over-year comparison adjustment.
The Agents and Infra segment recorded revenue of $76.8 billion, up 25% year over year, while Devices and Consumer revenue was about $15.5 billion, down 3%. The figures reflect a divergence between growth in the first segment and a decline in the second over the same period. Chief Executive Satya Nadella said the company was working to deliver “more capability, choice, control and cost efficiency to customers across our entire platform.” Microsoft returned $10.2 billion to shareholders during the quarter through dividends and share repurchases. The payments came as the company continued to expand its cloud business, according to its quarterly results.
Net cash from operations was $58 billion in the three months ended September 30. The company recorded additions to property and equipment of $39.367 billion, compared with $19.394 billion in the same period a year earlier. That places capital spending alongside the operating cash flows the company generated during the quarter. Microsoft reports additions to property and equipment in the cash flow statement under investing activities, while net cash from operations is listed under operating activities. The available materials did not provide a qualified market estimate for capital spending, so the results do not include a comparison with analyst expectations for that item.
Microsoft said it would provide its outlook for the coming period during the earnings conference and accompanying webcast. This gives investors access to management’s forecasts for upcoming periods as part of the conference. The company’s shares closed at $527.35999 on October 28, 2026, according to EL7 data. That is the closing price recorded for that day and does not by itself establish the share’s movement after trading ended. The closing data available here did not include a measure of the share’s movement in extended trading after the announcement.