Microsoft disclosed Azure's quarterly revenue for the first time—it surpassed Google Cloud's
Previously, Microsoft had only disclosed growth rates but had not revealed the absolute revenue of its Azure cloud service
Microsoft, the world's largest software maker, has disclosed quarterly sales figures for its Azure cloud division for the first time. Photo: Tada Images/Shutterstock
Microsoft, the world's largest software maker, has disclosed quarterly sales figures for its Azure cloud division for the first time. The company changed course after years of criticism from Wall Street: investors were dissatisfied that the corporation reported only growth rates without providing specific revenue figures for one of its key business drivers, according to Bloomberg. Given the size and scale of the cloud business, “it seems like now is the right time to provide an additional level of transparency,” said Jonathan Nilsson, head of investor relations at Microsoft.
In a document published on September 2, the company reported Azure's quarterly revenue for the past two years. This allowed for a direct comparison of the market giants’ performance: with revenue of $29.4 billion for the most recent quarter, Microsoft’s cloud division ranked second in the cloud services market by revenue among the three largest cloud providers, trailing the segment leader, Amazon — AWS ($42.2 billion) — but ahead of Google — Google Cloud ($24.8 billion), Reuters notes.
Against this backdrop, Microsoft shares rose nearly 3% during trading on September 3. Amazon shares gained about 1%, and Alphabet (Google’s parent company) shares also rose by about 1%.
What figures did Microsoft disclose?
Microsoft reported that revenue for its Azure division, which provides data storage and cloud software services, totaled $29.4 billion for the most recent quarter and $101.9 billion for the fiscal year that ended June 30.
Previously, Microsoft had only reported growth rates, not Azure’s absolute revenue. In its latest report for the fourth quarter of fiscal year 2026, which ended for Microsoft on June 30, the IT giant reported that revenue from Azure and its other cloud services grew 43% year-over-year, marking the strongest growth rate since early 2022—and accounted for about 30% of the company’s total revenue.
Why Microsoft Decided to Make These Changes
Microsoft announced planned changes to its accounting practices as part of the company’s first major reorganization of its core reporting segments since 2015, Bloomberg reports, noting that former CEO and shareholder Steve Ballmer had called for greater transparency regarding cloud sales more than 10 years ago.
“In a way, this is a key metric,” Ballmer said in a 2015 interview with Bloomberg. “If they call it the key to the company’s success, they need to report on it.”
Microsoft will now reduce the number of reporting segments from three to two by consolidating them. The two previous segments—Intelligent Cloud (the Azure cloud business and server products) and Productivity and Business Processes (Microsoft 365 and the former Office suite)—will be combined into a single new segment called “Agents and Infrastructure” (Agents and Infra). The third segment, More Personal Computing, which includes Windows revenue, search advertising revenue, and Xbox, will not be merged with the others but will simply be renamed “Devices and Consumer.”
The new reporting format will take effect this fall, when Microsoft reports its earnings for the first quarter of the new fiscal year.
“There’s no doubt that AI represents a fundamental shift in both technology and business,” Microsoft CEO Satya Nadella noted in a memo announcing the changes. “It is changing what we build and how we work, blurring the lines between our products and transforming our business models.”
Microsoft is a major cloud computing provider for OpenAI. Until recently, OpenAI relied exclusively on Microsoft’s infrastructure to train its models, but changes to the terms of the agreement have allowed it to also work with Amazon Web Services (AWS) and other providers, Reuters notes.
This article was AI-translated and verified by a human editor
