Microsoft said on its earnings call that Azure demand continues to run ahead of available capacity, while newly deployed AI infrastructure is able to generate economic returns within the same quarter it is brought online. The company also said free cash flow is expected to return to positive growth in fiscal 2027 as the pace of capital expenditure growth slows.
Chief Financial Officer Amy Hood disclosed that Microsoft’s Cloud business generated $214.4 billion in revenue in fiscal 2026, and that Azure annual revenue topped $100 billion for the first time. She also said nearly 90% of cloud revenue came from customers outside frontier model developers such as OpenAI and Anthropic, pointing to a broader base of enterprise AI demand across industries rather than reliance on a small group of leading AI model companies.
As of publication, Microsoft shares were up 8.83% in after-hours trading.
Microsoft said on its earnings call on July 30 that Azure demand continues to exceed existing capacity supply, and that newly deployed AI infrastructure can generate economic returns within the same quarter it is put into service.
The company also said it expects free cash flow to return to positive growth in fiscal 2027 as the growth rate of capital expenditures slows.
Chief Financial Officer Amy Hood said Microsoft’s Cloud business posted $214.4 billion in revenue in fiscal 2026, with Azure annual revenue surpassing $100 billion for the first time.
According to Hood, nearly 90% of Cloud revenue came from customers outside frontier large model companies such as OpenAI and Anthropic, indicating that enterprise AI demand has spread across a broader range of industry customers rather than depending mainly on leading AI model developers.
As of publication, Microsoft shares were up 8.83% in after-hours trading.
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