Azure Hits $100B, Copilot 30M

Microsoft just shattered expectations with Azure crossing $100 billion in annual revenue and Microsoft 365 Copilot notching over 30 million paid seats. Quarterly revenue soared to $90 billion, up 18%, while net income spiked 31%—all powered by a 43% jump in Azure and an eye-popping $678 billion in commercial RPO. But here’s the catch: Google Cloud’s growth is accelerating even faster, raising questions about whether Microsoft can maintain its AI momentum as the competition heats up.

Beneath the shiny numbers, Microsoft is playing a complex game with its spending. Capex hit $41 billion last quarter and is set to top $50 billion next, but accounting changes—like extending the useful life of data center buildings—soften how those investments look on paper, not in reality. Meanwhile, demand for AI infrastructure outstrips supply, and Microsoft’s in-house MAI models are slashing GPU costs by up to 89% in some apps, posing a real challenge to partners like OpenAI.

Yet a storm is brewing in the U.K., where regulators are probing whether Microsoft’s bundling of Copilot into Microsoft 365 is fair game or a risky move that could force changes in pricing and packaging. As Copilot seats surge from 20 million to 30 million in one quarter, the next big test is whether that growth can keep pace—and if Microsoft can keep regulators, enterprise customers, and rivals at bay. Featuring reporting from Reuters and the Wall Street Journal.

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