Microsoft demonstrated strong performance driven by its cloud and AI initiatives, exceeding expectations across key financial metrics. The company's AI business shows significant growth, and demand for its cloud infrastructure remains robust, contributing to accelerated revenue and operating income.
Revenue increased 18% year-over-year to $82.9 billion, with constant currency growth at 15%.
positiveOperating income increased 20% year-over-year to $38.4 billion, with constant currency growth at 16%.
positiveDiluted earnings per share increased 23% year-over-year to $4.27 on a GAAP basis.
positiveMicrosoft Cloud revenue grew 29% (25% in constant currency) to $54.5 billion.
positiveAI business surpassed an annual revenue run rate of $37 billion, up 123% year-over-year.
positiveCommercial remaining performance obligation increased 99% to $627 billion.
positiveMore Personal Computing segment revenue decreased 1% (down 3% in constant currency) to $13.2 billion.
attentionWindows OEM and Devices revenue decreased 2% (down 3% in constant currency).
attentionXbox content and services revenue decreased 5% (down 7% in constant currency).
attentionNon-GAAP net income was impacted by $14 million in net losses from investments in OpenAI for Q3 FY2026, compared to $583 million in net losses in Q3 FY2025.
attentionMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
| Segment | Current | Prior Yr | YoY | % Total | CC |
|---|---|---|---|---|---|
Productivity and Business Processes | N/A | — | — | — | +13.0% |
Intelligent Cloud | N/A | — | — | — | +28.0% |
More Personal Computing | N/A | — | — | — | -3.0% |
| Total Revenue | $0.00M | — | — | 100.0% | — |
Segment performance shows business unit health and growth drivers. Constant currency (CC) removes FX impact for like-for-like comparison.
Special items are non-recurring events that may distort period-over-period comparisons. Analysts typically adjust for these when calculating normalized earnings.
We are focused on delivering cloud and AI infrastructure and solutions that empower every business to eval-max their outcomes in the agentic computing era.
Our AI business surpassed an annual revenue run rate of $37 billion, up 123% year-over-year.
We delivered results that exceeded expectations across revenue, operating income, and earnings per share, reflecting strong execution and growing demand for the Microsoft Cloud.
Commentary excerpts from earnings call transcripts provide management's perspective on performance, strategy, and outlook. Always review full transcripts for complete context.
Operational metrics provide insight into business drivers and customer engagement beyond traditional financial measures.