Microsoft Q1 revenue rises 19% as Azure revenue climbs 48%

Microsoft Corp. (MSFT) said in a regulatory filing on Oct. 28, 2026 that revenue for the fiscal 2027 first quarter, which ended Sept. 30, rose 19% to $92.28 billion from a year earlier.

Adjusted earnings per share were $4.89, above the $4.82 consensus estimate compiled by Finnhub. Revenue was in line with the $92.49 billion estimate from the same source.

The results were set out in a press release furnished as Exhibit 99.1 to the company's 8-K.

Here's how the company did:

• Revenue: $92.28 billion vs. $77.67 billion a year earlier
• Adjusted EPS: $4.89 vs. $4.82 expected, according to Finnhub, and $4.13 a year earlier
• GAAP EPS: $4.92 vs. $3.72 a year earlier
• Operating income: $45.92 billion vs. $37.96 billion a year earlier
• GAAP net income: $36.63 billion vs. $27.75 billion a year earlier

The adjusted figures strip out the effect of investments in OpenAI. Those investments added $207 million to GAAP net income in the quarter, after cutting it by $3.1 billion a year earlier, the company said.

Azure and cloud

Azure revenue increased 48%. Microsoft Cloud revenue was $63.9 billion, up 30% and up 31% in constant currency.

Commercial remaining performance obligation rose 73% to $677 billion.

“We are delivering greater capability, choice, control, and cost efficiency for customers across our entire stack,” said Satya Nadella, chairman and chief executive officer of Microsoft.

Revenue in Agents and Infra was $76.8 billion, up 25%, with operating income of $40.56 billion. Revenue in Devices and Consumer was $15.5 billion, down 3%, with operating income of $5.36 billion. Windows OEM and devices revenue fell 22%.

According to its SEC filings, revenue has risen in each of the last three quarters, from $77.67 billion in the first quarter of fiscal 2026 to $90.01 billion in the fourth quarter of fiscal 2026.

Costs, spending and cash

Total operating expenses were $16.64 billion, up from $15.67 billion a year earlier. Additions to property and equipment were $39.37 billion, up from $19.39 billion.

Net cash from operations was $58.00 billion, up from $45.06 billion. Microsoft returned $10.2 billion to shareholders through dividends and share repurchases in the quarter.

Outlook

Microsoft did not give guidance figures in the release. It said it will provide forward-looking guidance on its earnings conference call and webcast on Oct. 28.

“We delivered a strong start to the fiscal year with Microsoft Cloud revenue of $63.9 billion, with growth accelerating to 30%,” said Amy Hood, executive vice president and chief financial officer of Microsoft. “Results exceeded expectations across revenue, operating income, and earnings per share.”