Microsoft reported stronger-than-expected quarterly results, driven by robust demand for its Azure cloud platform and AI services.
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Dado Ruvic
Microsoft Corp.’s cloud unit grew at the fastest pace in four years, suggesting that the company’s computing infrastructure and artificial intelligence services continue to make inroads with businesses.Azure cloud-computing revenue increased 43% during the fiscal fourth quarter, the company said Wednesday in a statement. That was the fastest quarterly growth since early 2022, and topped analysts’ average growth estimate of about 40%. Azure sales topped $100 billion for the first time during the fiscal year ended in June. The shares rose about 3% in extended trading after closing at $390.54.Microsoft helped usher in the artificial intelligence boom with its close partnership with OpenAI and has since shifted its focus to AI models and software capable of following instructions in natural language and acting autonomously. These products require enormous computing power, and the company has joined an industrywide spending boom to build new data centers and buy the expensive chips capable of building AI tools.Capital expenditures — a key metric of data center spending — increased 70% to $41 billion in the quarter. Analysts had expected $42 billion. Microsoft Chief Executive Officer Satya Nadella said in a statement that the company now counted more than 30 million paid users of Microsoft 365 Copilot, the AI assistant sold as an add-on to the ubiquitous Office software. That’s up from roughly 20 million three months earlier.The step-up in paid Copilot users is a good result, Bloomberg Intelligence analyst Mandeep Singh said in an interview on Bloomberg TV. “The bundling strategy that Microsoft has continues to work.”Total revenue increased 18% to $90 billion, beating average estimates for $87.7 billion. Profit was $4.81 per share, compared with a per-share estimate of $4.25. More stories like this are available on bloomberg.comPublished on July 30, 2026
