Microsoft’s latest quarter delivered 29% cloud growth, with Microsoft Cloud revenue hitting $54.5 billion. Total revenue rose 18% to $82.9 billion and net profit climbed 23% to $31.8 billion. The company’s AI annual revenue run rate now exceeds $37 billion, but management warns it’s supply constrained through 2026 while capex ramps to an estimated $190 billion for 2026.
Microsoft expects strong sales momentum for Azure as it ramps up investment for the next phase of the AI race. The company is planning substantial, record-level capital spending in 2026, alongside heavy AI infrastructure buildout. Investors are watching closely as Copilot’s user base continues to rise steadily, reinforcing demand for its AI assistant.
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Microsoft’s stock slid more than 2% in extended trading after its Azure growth and AI spending updates landed. While cloud revenue growth matched expectations, investors appeared focused on how it stacked up against faster-rising rivals. Updates on Copilot adoption also fed sentiment, but the takeaway was that “as expected” wasn’t enough.
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