Microsoft tops fiscal Q1 estimates as cloud surges and OpenAI revenue hits $10 billion
Microsoft reported fiscal first-quarter revenue of $92.3 billion and adjusted EPS of $4.89, beating Wall Street expectations on strong Azure performance and disclosing $10 billion in quarterly OpenAI revenue.
Microsoft Corp. beat Wall Street estimates across the board for its fiscal first quarter ended September 30, 2026, buoyed by accelerating cloud computing and artificial intelligence adoption. The company reported quarterly revenue increased 19% year over year to approximately $92.28 billion to $92.3 billion, topping analyst consensus forecasts of around $90.6 billion to $90.7 billion. Adjusted earnings per share reached $4.89, clearing expectations of $4.72 to $4.73. Following the earnings release, Microsoft shares rose between 3% and 5% in after-hours trading.[1][4][5][6][7][9][10][13][14][17][21][25]
Growth was driven by Microsoft's cloud segment, where overall cloud revenue advanced 30% year over year to $63.9 billion. Azure revenue jumped 48% to about $33.2 billion, ahead of the $32.32 billion consensus estimate. Operating income rose 21% to $45.9 billion. Chief Financial Officer Amy Hood attributed the 48% Azure surge to Foundry revenue more than tripling year over year, higher token pricing, and fleet efficiency improvements, noting that overall demand continues to outpace available capacity.[3][4][10][15][17][19][23]
A regulatory filing detailed the scale of Microsoft's commercial ties to OpenAI, reporting $10 billion in revenue from OpenAI commercial arrangements during the quarter, including revenue-sharing payments. According to TechCrunch, the sum represented nearly 11% of Microsoft's total quarterly revenue, alongside $7.2 billion in outstanding receivables from OpenAI. OpenAI-related items created a $207 million net gain, representing a $0.03 EPS impact.[8][10][20][24][26]
In contrast to cloud expansion, Microsoft recorded weakness in consumer hardware: Windows OEM and devices revenue declined 22% year over year, Xbox hardware revenue dropped 14%, and Xbox content and services fell 2%. On cash flow, Reuters reported free cash flow reached $18.6 billion versus the $8.54 billion expected, with quarterly capital expenditures at $45.2 billion compared to a $50 billion projection, although other market reports cited capex of $39.4 billion.[2][7][10][11][12][13][18][22]
Key facts
- Microsoft reported fiscal Q1 revenue rose 19% year over year to approximately $92.28 billion to $92.3 billion, topping analyst consensus forecasts of roughly $90.6 billion to $90.7 billion.
- Adjusted earnings per share came in at $4.89, beating the analyst consensus of $4.72 to $4.73.
- Azure revenue grew 48% year over year to approximately $33.2 billion, beating analyst estimates of $32.32 billion.
- Microsoft recognized $10 billion in revenue from commercial arrangements with OpenAI, which includes revenue sharing and represents nearly 11% of total quarterly revenue.
- Microsoft held $7.2 billion in outstanding receivables from OpenAI at the end of the quarter.
- Free cash flow reached $18.6 billion, well ahead of the $8.54 billion analyst estimate.
- Windows OEM and devices revenue fell 22% year over year, while Xbox hardware revenue dropped 14% and Xbox content and services declined 2%.
- Quarterly capital expenditures were reported at $45.2 billion by Reuters, below Microsoft's $50 billion projection, while other earnings reports listed capex at $39.4 billion.
Sources · 20 sources
- TR
TrendSpider@TrendSpiderPost on X ·
MICROSOFT $MSFT EARNINGS GOD CANDLE Adj EPS: $4.89 vs $4.72 est ✅ Sales: $92.729B vs $90.663B est ✅ https://t.co/QOLmFtBCNj
Open source - TE
TechmemeArticle ·
Microsoft reports Q1 capex of $45.2B, up from $34.9B a year earlier and below its own $50B projection, and free cash flow of $18.6B, vs. $8.54B est. by analysts (Deborah Sophia/Reuters) Deborah Sophia / Reuters : Microsoft reports Q1 capex of $45.2B, up from $34.9B a year earlier and below its own $50B projection, and free cash flow of $18.6B, vs. $8.54B est. by analysts — Microsoft (MSFT.O) surpassed expectations for quarterly cloud revenue on Wednesday, signaling that its hefty AI investments …
Open source - RE
Reuters@ReutersPost on X ·
Microsoft beats quarterly cloud revenue estimates https://t.co/bgxYu9WHVc
Open source - TE
TechmemeArticle ·
Microsoft reports Q1 revenue up 19% YoY to $92.28B, vs. $90.69B est., Azure revenue up 48% to $33.17B, vs. $32.32B est., and net income up 32% to $36.63B (Microsoft) Microsoft : Microsoft reports Q1 revenue up 19% YoY to $92.28B, vs. $90.69B est., Azure revenue up 48% to $33.17B, vs. $32.32B est., and net income up 32% to $36.63B — REDMOND, Wash. — October 28, 2026 — Microsoft Corp. today announced the following results for the quarter ended September 30, 2026 …
Open source - TE
TechCrunch@TechCrunchPost on X ·
Whatever the future of AI might be, the current situation is still very good for Microsoft. The tech giant reported yet another record for quarterly revenue on Wednesday: $92.3 billion, a 19% increase over the year-ago quarter. https://t.co/WsbC7NZmST
Open source - TM
That Martini Guy ₿@MartiniGuyYTPost on X ·
Microsoft shares rallied 5% following its earnings report Key notes: - Revenue and earnings per share both beat analyst expectations - Wall Street had forecast approximately $90.6 billion in revenue and $4.72 in EPS - Strong cloud demand, particularly for Azure, helped drive the results - Continued investment in AI infrastructure remains central to Microsoft's growth strategy - Investors are closely watching Azure expansion, Copilot adoption and returns on AI spending
Open source - BT
Bull Theory@BullTheoryioPost on X ·
BREAKING: $MSFT is up over 4% after reporting stronger than expected earnings in Q1 2027 fiscal year. Revenue came in at $92.3 Billion against a $90.69 Billion estimate. Yearly Revenue is up 19%, largely driven by Microsoft Cloud +30% and by Azure's +48%. Free cash flow came in at $18.6 Billion, nearly 118% above the $8.54 billion estimate.
Open source - CB
Crypto BriefingArticle ·
Microsoft records $10 billion from OpenAI commercial deals in fiscal Q1 Microsoft's significant revenue from OpenAI deals highlights the growing importance of AI partnerships in driving tech industry growth. The post Microsoft records $10 billion from OpenAI commercial deals in fiscal Q1 appeared first on Crypto Briefing .
Open source - BM
Brew Markets@brewmarketsPost on X ·
Microsoft earnings: • Revenue: $92.28B vs $90.69B expected • EPS: $4.89 vs $4.73 expected https://t.co/1cWFQno62o
Open source - WS
Wall St Engine@wallstenginePost on X ·
MICROSOFT $MSFT Q1’27 EARNINGS HIGHLIGHTS 🔹 Revenue: $92.3B (Est. $90.69B) 🟢; +19% YoY 🔹 Adj. EPS: $4.89 (Est. $4.73) 🟢; +18% YoY 🔹 Oper Income: $45.9B (Est. $44.06B) 🟢; +21% YoY 🔹 Adj. Net Income: $36.4B (Est. $35.13B) 🟢 🔹 Azure: $33.2B (Est. $32.32B) 🟢; +48% YoY 🔹 Azure Growth ex-FX: +48% (Est. +45.2%) 🟢 🔹 Azure Growth: +48% YoY (Est. +44.7%) 🟢 🔹 Microsoft Cloud: $63.9B; +30% YoY 🔹 Commercial RPO: $677B (Est. $705.6B) 🔴 Agents and Infra: 🔹 Agents & Infra Revenue: $76.8B (Est. $75.6B) 🟢 🔹 Agents and Infra Operating Income: $40.6B 🔹 Industry Solutions: $5.3B (Est. $5.4B) 🔴 Devices and Consumer: 🔹 Devices & Consumer Revenue: $15.5B (Est. $15.0B) 🟢 🔹 Devices and Consumer Operating Income: $5.4B 🔹 Search & Advertising: $6.6B (Est. $6.4B) 🟢 🔹 XBOX: $5.4B (Est. $5.0B) 🟢; -2% YoY 🔹 Windows OEM & Devices: $3.6B (Est. $3.5B) 🟢 Financials: 🔹 CapEx: $39.4B (Est. $46.59B) 🟢 🔹 CapEx to Revenue: ~42.7% Key Updates: 🔹 OpenAI Impact: $207M net gain; $0.03 EPS impact Capital Return: 🔹 Returned $10.2B to shareholders via dividends & share repurchases CEO Commentary – Satya Nadella: 🔸 “By helping organizations build and own their own intelligence, and earning trust through agent safety and security, we are translating our innovation into growing adoption and real-world impact across every industry.” CFO Commentary – Amy Hood: 🔸 “Results exceeded expectations across revenue, operating income, and earnings per share.”
Open source - TV
The Verge@vergePost on X ·
Windows and Xbox revenues have declined during Microsoft’s first quarter of the 2027 financial year. https://t.co/Z41ED8TQ1B
Open source - TE
Techmeme@TechmemePost on X ·
Microsoft reports Q1 capex of $45.2B, up from $34.9B a year earlier and below its own $50B projection, and free cash flow of $18.6B, vs. $8.54B est. by analysts (@deborah_sophia / Reuters) (Visit Techmeme dot com for the link and full context!)
Open source - GU
GURGAVIN@gurgavinPost on X ·
MICROSOFT EARNINGS JUST CAME OUT *MICROSOFT 1Q ADJ EPS $4.89, EST. $4.73 ( BEAT ✅ ) *MICROSOFT 1Q REV. $92.28B, EST. $90.63B ( BEAT ✅ ) *MICROSOFT 1Q CAPEX $39.37B, EST. $45.93B $MSFT https://t.co/TccWkmL5zY
Open source - UW
unusual_whales@unusual_whalesPost on X ·
BREAKING: Microsoft, $MSFT, earnings: - EPS: $4.89, est: $4.72 - Revenue: $92.2 billion, est: $90.7 billion
Open source - WS
Wall St Engine@wallstenginePost on X ·
Microsoft $MSFT CFO Amy on what drove Azure's 48% YoY growth: “Foundry rev more than tripled YoY” “...efficiency gains across our GPU fleet, that allowed us to allocate additional capacity to customers, as well as higher rev per token...” “Across our CPU fleet, engineering work enabled us to identify and monetize underutilized capacity this quarter, helping us serve more of the growing demand with our existing capacity.” “We had higher token pricing than we expected in the quarter.” “Token pricing will create a little bit of variability.” “...we still have demand that exceeds supply.”
Open source - SI
Solid Intel 📡@solidintel_xPost on X ·
INTEL: Microsoft $MSFT Q1 revenue of $92.28 billion tops the $90.63 billion expected | Per Bloomberg
Open source - CB
Crypto Briefing@Crypto_BriefingPost on X ·
📈 NEW: Microsoft ($MSFT) beats Wall Street expectations with $92.3B in quarterly revenue and $4.89 in adjusted EPS, sending shares up nearly 3% after hours. Azure revenue surged 48% to $33.2B, fueled by strong demand for AI and cloud computing. https://t.co/rmVXRN5uhd
Open source - TW
Tom Warren@tomwarrenPost on X ·
Microsoft's Q1 2027 (fiscal) earnings: • 💻 Windows OEM + devices revenue down 22% • 🕹️ Xbox content + services rev down 2% • 🎮 Xbox hardware rev down 14% • ☁️ Azure revenue up 48% https://t.co/5CselsTmlW
Open source - BL
Bloomberg@businessPost on X ·
Microsoft reported better-than-expected cloud revenue, suggesting the company continues to reap the benefits of its massive investment in artificial intelligence. https://t.co/BDTGFuwpe6
Open source - TE
Techmeme@TechmemePost on X ·
Filing: Microsoft recorded $10B in revenue from OpenAI in Q1, nearly 11% of its total quarterly revenue, and has $7.2B in outstanding receivables from OpenAI (@rebeccabellan / TechCrunch) (Visit Techmeme dot com for the link and full context!)
Open source - EV
Evan@StockMKTNewzPost on X ·
MICROSOFT $MSFT JUST REPORTED EARNINGS EPS of $4.89 beating expectations of $4.72🟢 Revenue of $92.3B beating expectations of $90.7B🟢 https://t.co/DEmCloAuV5
Open source - SB
Shay Boloor@StockSavvyShayPost on X ·
$MSFT CRUSHED THEIR Q1 EARNINGS • Revenue $92.2B vs Est. $90.7B • EPS $4.89 vs Est. $4.72 • Azure Revenue $33.2B vs Est. $32.3B • Operating Income $45.9B vs Est. $43.9B • Commercial RPO: $677B vs Est. $706B • CapEx $39.4B vs Est. $45.9B https://t.co/Haj9KhP2gV
Open source - TE
Techmeme@TechmemePost on X ·
Microsoft reports Q1 revenue up 19% YoY to $92.3B, Azure revenue up 48% to $33.2B, operating income up 21% to $45.9B, and net income up 32% to $36.6B (Microsoft) (Visit Techmeme dot com for the link and full context!)
Open source - TE
TechmemeArticle ·
Filing: Microsoft recorded $10B in revenue from OpenAI in Q1, nearly 11% of its total quarterly revenue, and has $7.2B in outstanding receivables from OpenAI (Rebecca Bellan/TechCrunch) Rebecca Bellan / TechCrunch : Filing: Microsoft recorded $10B in revenue from OpenAI in Q1, nearly 11% of its total quarterly revenue, and has $7.2B in outstanding receivables from OpenAI — Microsoft generated $10 billion in revenue from commercial arrangements with OpenAI, including revenue-sharing payments …
Open source - FT
Financial Times@FTPost on X ·
Breaking news: The software group’s overall revenue rose 19%, boosted by better than expected earnings in its cloud business. https://t.co/Vx7kuCx5C4 https://t.co/CxnOpYWXBc
Open source - TE
TechCrunch@TechCrunchPost on X ·
Microsoft said it made $10 billion in revenue from commercial arrangements with OpenAI, including revenue-sharing payments, in the quarter ending September 30. It underscores the still-enormous financial dependency of the partnership. https://t.co/YIx3WscwO9
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