Microsoft closes financial year with record revenue thanks to cloud and AI
Microsoft has closed the fourth quarter of its broken 2026 financial year with record results. The software giant benefited from the persistently strong demand for cloud and AI services, which led to a sharp increase in both revenue and profit.
Revenue came in at $89.5 billion, an increase of 17% compared with the same period a year earlier. Net profit rose by 24% to $27.2 billion, while earnings per share amounted to $3.65.
The cloud activities in particular remained the driving force behind the group’s growth. Revenue from Microsoft Cloud rose to $56.5 billion, an increase of 27%. Within that division Azure grew by 39%, driven by rising demand for AI applications and cloud infrastructure.
The productivity and business processes division, which includes Microsoft 365, LinkedIn and Dynamics, also showed solid growth. Revenue increased by 15% to $34.7 billion. The more personal computing division, which includes Windows, Xbox and search advertising, grew by 9% to $14.4 billion.
Chief executive Satya Nadella said that AI has now become the main driver of Microsoft’s growth. “Cloud and AI are the driving force behind the digital transformation of organisations in virtually every sector,” according to the CEO.
In the quarter, Microsoft paid out $9.8 billion to shareholders through dividends and share buybacks. At the same time, the group continues to invest heavily in data centres and AI capacity in order to meet the strong demand for cloud services.
Even so, not everything is going well. Earlier this month it emerged that the tech group is going to cut 3,200 jobs at Xbox, around 20% of its workforce. The move is part of a large-scale reorganisation of the ailing gaming division. Outside Xbox, more than 3,000 jobs will disappear at Microsoft, mainly in the sales divisions. In addition, Xbox is divesting several game studios.
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