Microsoft Prints Azure’s $29.42 Billion Quarter and Shrinks the Map

Microsoft posted $29.42 billion of Azure revenue for the June quarter, its first quarterly dollar figure for the cloud unit. The recast number, posted in a September 2, 2026 investor deck, puts Azure behind Amazon Web Services and ahead of Google Cloud.

The same materials cut Microsoft’s operating map from three segments to two and pulled GitHub cloud, Security Copilot, and healthcare cloud out of Azure, so the new sales line is a narrower consumption business still reported without its own profit figure.

Azure’s First Quarterly Dollar Figure Lands Behind Amazon

Under the new definition, Azure grew 42% to $29.42 billion in the quarter ended June 30, 2026, from $20.71 billion a year earlier. That is almost 33% of Microsoft’s $90.0 billion in company sales for the period. The old “Azure and other cloud services” growth rate for the same quarter was 43%.

For the fiscal year, restated Azure sales were $101.9 billion, up 40% from $72.61 billion. Chairman and Chief Executive Officer Satya Nadella had already told investors on July 29 that Azure had crossed $100 billion for the year. What the September deck adds is the quarterly dollar series, not a new burst of demand.

Amazon, which has broken out AWS as its own line since 2015, reported AWS sales of $42.2 billion for its June quarter, up 37%, with $16.6 billion of operating income and $148.4 billion of trailing-twelve-month sales. Alphabet’s June quarter put Google Cloud at $24.8 billion, up 82%. Microsoft still does not publish an operating profit for Azure alone, so the new scoreboard is sales, not margins.

THE JUNE QUARTER CLOUD SCOREBOARD

Microsoft shares rose about 1.4% in after-hours trading on September 2 after the deck went up. The print lets anyone rank the three clouds on one page. It does not change how much Microsoft said it will collect as a company in the current quarter.

THE CLOUD DISCLOSURE CALENDAR

1. 2015: Amazon begins reporting AWS sales as a segment, and Microsoft installs the three-segment map it is now retiring.
2. 2020: Alphabet begins reporting Google Cloud sales, including Workspace subscriptions.
3. Fiscal 2026: Microsoft gives Azure an annual dollar total and keeps publishing only a quarterly growth rate.
4. September 2, 2026: Microsoft posts the first quarterly Azure dollar series and moves to two reportable segments.

Alphabet’s cloud number still mixes infrastructure with productivity subscriptions, and Azure’s new number is meant to be infrastructure and consumption. The comparison is cleaner than it was when Microsoft offered a growth rate and nothing else, and it is still not a like-for-like profit comparison with AWS.

GitHub, Security Copilot and the Healthcare Shift

Nadella wrote in the deck that, under the new map, Azure “becomes more purely our consumption-based platform and infrastructure business.” The purification is a set of moves, not a slogan. GitHub cloud and other developer cloud services, plus Security Copilot, leave Azure and enter Microsoft 365 commercial cloud. Healthcare and Life Sciences cloud, a line that had absorbed Nuance Communications after that deal, leaves Azure for a new Industry solutions cloud metric.

WHAT LEFT THE AZURE LINE

• GitHub cloud: Cloud and other developer services move into Microsoft 365 commercial cloud, and paid GitHub seats now count in commercial seat growth.
• Security Copilot: The security assistant follows GitHub out of Azure and into the Microsoft 365 cloud bundle.
• Healthcare cloud: Healthcare and Life Sciences cloud moves into Industry solutions, alongside Dynamics 365 and LinkedIn Talent and Sales.

Those shifts show up in the growth rates. Restated Azure grew 42% in the June quarter, one point slower than the old Azure-and-other-cloud figure. Restated Microsoft 365 commercial cloud grew 16% as reported and 15% in constant currency, against 14% on the old definition. Commercial seat growth is restated at 7% for the year, against 6% before GitHub seats were added.

Microsoft 365 cloud, commercial and consumer together, was $26.72 billion in the June quarter and $100.3 billion for the year, just behind restated Azure. Industry solutions, the new vertical bucket, did $5.29 billion in the quarter and $20.35 billion for the year. The extras that used to ride inside Azure were never the main engine of that 42% print; moving them still lets Microsoft sell Azure as a cleaner consumption line.

Agents and Infra Now Accounts for 83% of Sales

Beginning in fiscal 2027, Microsoft will report two segments instead of Productivity and Business Processes, Intelligent Cloud, and More Personal Computing, the split in place since 2015. The restated Azure quarterly revenue tables sit inside a larger recast that also restates two years of segment sales, costs, and operating income on the new map.

Agents and Infra holds Azure, Microsoft 365 cloud, productivity and server licensing, Industry solutions, and frontier and support services (the old enterprise and partner services line under a new name). Devices and Consumer holds search and advertising, Xbox, and Windows OEM and devices.

THE TWO-SEGMENT P&L, JUNE QUARTER

Agents and Infra did $268.1 billion of sales and $136.4 billion of operating income for fiscal 2026. Devices and Consumer did $63.7 billion of sales and $18.9 billion of operating income. In the June quarter, Agents and Infra produced 90% of company operating income. The old three-segment cost lines will not be the way Microsoft reports going forward; profitability will be shown on these two books.

Nadella told investors they will still see quarterly sales for Azure, Microsoft 365 cloud, Industry solutions, and ads inside the new segments. Product-level sales get more detail. The company’s profit story gets simpler, and Azure still has no standalone margin.

Xbox, Windows and Ads Lose Their Old Home

More Personal Computing, the old consumer segment, did $12.9 billion of sales in the June quarter, down 4%. The new Devices and Consumer bucket is larger at $15.43 billion because it absorbs LinkedIn Marketing Solutions and LinkedIn Premium, which now sit with search advertising rather than with the rest of LinkedIn.

The underlying hardware and games lines are still the soft side of the company. In the July 29 results, Windows OEM and Devices revenue fell 7%, and Xbox content and services revenue fell 10%. Restated Xbox sales were $4.98 billion in the June quarter and $21.79 billion for the year, against $23.46 billion a year earlier. Restated Windows OEM and devices sales were $4.01 billion in the quarter. Search and advertising, now including those LinkedIn ad and premium lines, did $6.44 billion in the quarter and $24.84 billion for the year.

Devices and Consumer operating income was $3.87 billion in the June quarter, down from $4.10 billion a year earlier on the restated books. The consumer franchise is still a large business. It is no longer a third of the reporting map, and it is a much smaller share of profit than of sales.

Why Azure’s Growth Forecast Ticked Down a Point

Microsoft did not change its company-level outlook when it posted the recast. Fiscal first-quarter revenue is still $89.85 billion to $90.95 billion. Cost of revenue, operating expenses, operating margin, tax rate, and capital spending are unchanged, including capital spending of more than $50 billion in the quarter that ends September 30, 2026.

What moved is the Azure growth line, and Microsoft called the move mechanical. On July 29 the company had guided Azure and other cloud services to about 45% growth in constant currency. The new Azure guide is 44% to 45% in constant currency, with foreign exchange expected to cut reported growth by less than one point. GitHub cloud sales that used to sit in Azure now sit in Microsoft 365 cloud, so Azure’s rate ticks down and Microsoft 365 commercial cloud’s rate ticks up, to about 17% in constant currency from about 15%.

THE Q1 GUIDE AFTER THE RECAST

• Azure growth: 44% to 45% in constant currency, against the July guide of about 45% for Azure and other cloud services.
• Agents and Infra: $75.15 billion to $75.75 billion of sales, after $74.6 billion in the June quarter.
• Devices and Consumer: $14.7 billion to $15.2 billion, after $15.43 billion in the June quarter.
• Company sales: $89.85 billion to $90.95 billion, with no change to the July 29 total.

A printed Azure number is being read in market chatter as Microsoft catching up with AWS on disclosure, and as a possible setup for later cloud price arguments. The September 2 segment change filing is narrower than that: it restates history, splits the guide into two segments, and leaves the company’s total sales, costs, and capex where they were in July. The first earnings report on the new map will be fiscal 2027’s first quarter.

Copilot Seats Now Sit With GitHub in Microsoft 365 Cloud

Agents and Infra is also where Microsoft wants investors to watch paid AI seats next to infrastructure consumption. Microsoft 365 commercial cloud now includes Microsoft 365 Copilot, GitHub cloud, other cloud developer services, and Security Copilot. On July 29, Nadella said Azure surpassed $100 billion for the year and Microsoft 365 Copilot had reached over 30 million paid seats, up from more than 20 million in April.

There’s no question AI represents a profound shift in both technology and business. It is changing what we build and how we operate, and it is blurring the boundaries between our products and reshaping our business models.

Satya Nadella, Chairman and Chief Executive Officer, FY27 Segments and Investor Metrics presentation

Chief Financial Officer Amy Hood, on the same July 29 release, put Microsoft Cloud revenue at $59.3 billion for the quarter, up 27%, with commercial remaining performance obligation at $678 billion, up 84%. The new investor-metric definition of Microsoft Cloud is Azure plus Microsoft 365 commercial cloud plus Industry solutions cloud. That is the stack Nadella is grouping as agents and infrastructure, from apps that finish a job through the models that reason to the capacity that trains and serves them.

Analysts at Stifel estimated in July that about half of Azure’s revenue growth in fiscal 2026 came from OpenAI, and that Anthropic has also leaned more on Microsoft’s cloud. The new Azure line still does not break out that customer. OpenAI concentration remains an estimate sitting under a $29.42 billion total, not a figure Microsoft printed in the recast.

Fiscal 2027’s first-quarter results will be the first time the two-segment books, the purified Azure dollar figure, and the Copilot-and-GitHub Microsoft 365 cloud line are reported together as the official scorecard. Company sales for that quarter are still guided at $89.85 billion to $90.95 billion, the same range Microsoft gave on July 29 before anyone had a quarterly Azure number to put next to AWS.

Disclaimer: This article is news reporting and analysis of Microsoft’s segment recast and Azure sales figures, and it is for information only. It is not investment advice, a recommendation to buy or sell Microsoft or any other security, and it is not a forecast of future revenue, margins, or cloud market share. Readers should consult a licensed financial adviser or securities professional who can review their own holdings and risk tolerance before making any investment decision. Figures, growth rates, and segment definitions reflect Microsoft’s September 2, 2026 presentation, related SEC exhibits, and the company’s July 29, 2026 results, and those items can change in later filings and earnings reports.