Microsoft posts blockbuster quarterly results riding on AI boom; CEO Satya Nadella says, ‘Never been more confident’
Microsoft CEO Satya Nadella highlighted cloud growth and artificial intelligence tools following the company's earnings call. In posts on X, he described a fast start to the financial year. Microsoft Cloud revenue crossed $63 billion, with annual growth accelerating to 30%.
Satya Nadella highlighted Microsoft’s biggest Copilot update, which combines Chat, Cowork, Autopilot, and Code. Daily users increased nearly 50% over the previous quarter.
Their number also grew more than five times compared with last year. User satisfaction improved nearly 20% from the previous quarter, reaching another record.
Customers holding more than 50,000 Copilot seats increased eightfold over the year. Nadella also highlighted GitHub Copilot Fusion, announced that morning.
He said it offered leading quality at costs up to 77% lower. A comparison credited to Artificial Analysis placed Fusion near 60 on its coding index. Its average cost was roughly $5.50 per task.
Nadella said improving intelligence for each task must accompany better costs and performance. Microsoft is also bringing Dynamics 365 business capabilities directly into Copilot. The aim is to help organisations build their own software services.
Foundry revenue more than tripled compared with last year. Customers building with multiple models increased fivefold, while revenue from open-source models rose tenfold. Microsoft is bringing Foundry and Fabric closer, helping customers build agents near their data. Nearly 60,000 customers access business information through Microsoft IQ, up 25% from the previous quarter.
The Microsoft CEO also outlined efforts to control and secure AI agents. Agent 365 now has over 50 million agents, up 30% from the previous quarter.
Microsoft is combining Windows and Agent 365 to support agents within secure device boundaries. OpenAI Codex, Anthropic Claude Code and Meta Muse are adopting this approach.
According to him, Perception handles identity, permissions, monitoring and containment outside the AI model. Microsoft is adding computing capacity faster and improving utilisation of existing infrastructure.
Nadella said Azure's growth spanned large companies, smaller businesses, cloud services, and AI infrastructure.
“I have never been more confident in the opportunity ahead of us,” he said.
Microsoft’s July-September revenue rose 19% annually to $92.3 billion. Operating income increased 21% to $45.9 billion. Reported net income climbed 32% to $36.6 billion. Cloud revenue reached $63.9 billion while Azure revenue grew 48%.
Microsoft CFO Amy Hood said results exceeded expectations. Microsoft expects December-quarter revenue between $96 billion and $97.1 billion.
“We delivered a strong start to the fiscal year with Microsoft Cloud revenue of $63.9 billion, with growth accelerating to 30% (up 31% in constant currency) year-over-year,” Hood, also the executive vice president of the company, added.
According to Hood, customer demand continues to exceed supply. Meanwhile, Devices and Consumer revenue fell 3% to $15.5 billion.
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