Microsoft delivered a strong start to its fiscal year Wednesday as accelerating Azure growth demonstrated continuing enterprise demand for cloud computing and artificial-intelligence infrastructure.
Revenue increased 19% from a year earlier to $92.3 billion, while operating income climbed 21% to $45.9 billion.
Net income reached $36.6 billion on a GAAP basis, increasing 32%, while diluted GAAP earnings per share rose 32% to $4.92. Microsoft reported adjusted earnings of $4.89 per share.
Azure generated approximately $33.2 billion in quarterly revenue, increasing 48% from a year earlier. The disclosure provided investors with a clearer measure of Microsoft’s cloud scale as competition intensifies among Microsoft, Amazon and Google for AI workloads.
Microsoft Cloud revenue reached $63.9 billion, increasing 30% year over year.
The results strengthen the case that Microsoft’s enormous investments in AI infrastructure are being accompanied by substantial growth in its core cloud operation.
Azure has become particularly important because businesses increasingly use cloud infrastructure not only for conventional computing but also to train, deploy and operate artificial-intelligence models.
Microsoft’s challenge will be maintaining that growth while managing the extraordinary capital requirements associated with expanding data centers, processors and power infrastructure.
The next several quarters will show whether Azure can continue accelerating as competition for enterprise AI workloads intensifies.
