Microsoft delivered one of its strongest quarters ever on Wednesday, reporting fiscal fourth-quarter revenue of $90.01 billion — an 18% jump year over year that crushed Wall Street estimates of $87.62 billion.
The standout number was Azure. Microsoft's cloud platform surpassed $100 billion in annual revenue for the first time, growing 41% for the full fiscal year. In Q4 alone, Azure revenue hit $39.31 billion, up 31.6% and beating the $38.16 billion consensus. Growth accelerated to 43% at constant currency, up from 40% in the prior quarter — a rare acceleration at this scale.
CEO Satya Nadella pointed to broad enterprise adoption, noting that hundreds of customers purchased millions of seats for high-end E7 productivity bundles. Microsoft 365 Copilot, the company's AI work assistant, now has over 30 million paid seats, up from 20 million just three months ago. GitHub Copilot, the AI coding assistant, reached 50 million users.
Earnings per share came in at $4.74 adjusted, well above the $4.24 analysts expected. Net income was $35.77 billion, boosted by a $3.2 billion gain from Microsoft's investment in AI lab Anthropic.
The company also announced it would extend the useful life of its data center and office buildings to 25 years from 15, a move that will result in roughly $175 billion in capital expenditures and finance leases for fiscal 2026. Capital spending in Q4 alone jumped 69% to $41 billion.
Microsoft's stock surged 8% in after-hours trading, though shares remain down 19% for 2026 as investors have punished software stocks amid fears of disruption from generative AI. CFO Amy Hood projected $89.85 to $90.95 billion in fiscal Q1 revenue and said the company expects to remain free-cash-flow positive in fiscal 2027.
The results underscored a key tension in Microsoft's business: the company is both building AI infrastructure at massive scale and confronting what analysts call "concentration risk" with its OpenAI relationship, especially as open-source models gain ground.
