Global Finance News
01 Nov 2026, 10:58
Microsoft Posts Strong FY27 Q1 as Azure Growth Accelerates and Cloud Backlog Surges
Microsoft (NASDAQ: MSFT) reported a strong fiscal first-quarter 2027, with revenue rising 19% year over year to $92.3 billion and results exceeding management’s expectations across revenue, operating income and earnings per share.
Operating income increased 21% to $45.9 billion, while GAAP net income rose 32% to $36.6 billion. Non-GAAP net income, which excludes the impact of Microsoft’s OpenAI investments, increased 18% to $36.4 billion. Adjusted diluted EPS rose 18% to $4.89.
Cloud and AI infrastructure remained the primary growth engines. Microsoft Cloud revenue jumped 30% to $63.9 billion, while Azure revenue increased 48%. Commercial remaining performance obligation surged 73% to $677 billion, providing substantial visibility into future contracted revenue.
Microsoft 365 commercial cloud revenue grew 18% on an adjusted basis, while consumer cloud revenue rose 17%. Search and advertising revenue excluding traffic acquisition costs increased 12%.
Consumer hardware remained the main weak area. Windows OEM and Devices revenue declined 22%, while Xbox content and services revenue fell 2%. Overall Devices and Consumer revenue decreased 3% to $15.5 billion.
The quarter reinforces Microsoft’s position as a major beneficiary of enterprise AI and cloud spending, with accelerating Azure growth and a rapidly expanding backlog outweighing continued weakness in devices and gaming. Microsoft returned $10.2 billion to shareholders through dividends and share repurchases during the quarter.
Microsoft (NASDAQ: MSFT) reported a strong fiscal first-quarter 2027, with revenue rising 19% year over year to $92.3 billion and results exceeding management’s expectations across revenue, operating income and earnings per share.
Operating income increased 21% to $45.9 billion, while GAAP net income rose 32% to $36.6 billion. Non-GAAP net income, which excludes the impact of Microsoft’s OpenAI investments, increased 18% to $36.4 billion. Adjusted diluted EPS rose 18% to $4.89.
Cloud and AI infrastructure remained the primary growth engines. Microsoft Cloud revenue jumped 30% to $63.9 billion, while Azure revenue increased 48%. Commercial remaining performance obligation surged 73% to $677 billion, providing substantial visibility into future contracted revenue.
Microsoft 365 commercial cloud revenue grew 18% on an adjusted basis, while consumer cloud revenue rose 17%. Search and advertising revenue excluding traffic acquisition costs increased 12%.
Consumer hardware remained the main weak area. Windows OEM and Devices revenue declined 22%, while Xbox content and services revenue fell 2%. Overall Devices and Consumer revenue decreased 3% to $15.5 billion.
The quarter reinforces Microsoft’s position as a major beneficiary of enterprise AI and cloud spending, with accelerating Azure growth and a rapidly expanding backlog outweighing continued weakness in devices and gaming. Microsoft returned $10.2 billion to shareholders through dividends and share repurchases during the quarter.
