Microsoft reported Q1 revenue of $77.7 billion, surpassing analyst expectations

Microsoft reported its first-quarter earnings after the bell on ￰0￱ company beat expectations on both profit and revenue, with strong demand from its cloud business driving ￰1￱ the stock still dropped more than 2% after the company revealed a major jump in spending tied to AI ￰2￱ company reported $77.7 billion in revenue for the quarter, compared to $65.6 billion in the same quarter last ￰3￱ per share came in at $3.72, up from $3.30 last year and ahead of the $3.68 analysts expected. Microsoft’s commercial cloud revenue reached $49.1 billion, up 26% year over year and above the $48.6 billion ￰4￱ quarter also saw Microsoft’s Intelligent Cloud division, which includes Azure, report $30.9 billion in revenue, beating the $30.2 billion Wall Street ￰5￱ also reported that capital expenditures rose 74% from last year to $34.9 billion, and said about half of that total went into GPUs and CPUs to support demand for ￰6￱ spending increase was large enough to concern investors, who have grown sensitive to the cost of scaling AI Microsoft disclosed the results hours after Azure services recovered from a global ￰7￱ outage followed a separate outage at Amazon’s AWS a week ￰8￱ increases AI spending while Azure demand rises The rise in spending was tied directly to growth in AI ￰9￱ company has been increasing investment in data centers and chips as customers adopt AI ￰10￱ of that spending is connected to Microsoft’s partnership with ￰11￱ two companies recently agreed on new terms that change how OpenAI is structured and how both sides invest in AI ￰12￱ the revised agreement, OpenAI will reconfigure into a for‑profit public benefit corporation overseen by its ￰13￱ will hold a 27% stake in the OpenAI Group PBC, a holding valued at roughly $135 billion, while the OpenAI nonprofit will hold around $130 billion worth of ￰14￱ has already invested billions in OpenAI, and the deal outlines continued ￰15￱ was previously the exclusive cloud provider for ￰16￱ arrangement allowed the company to draw AI traffic directly into ￰17￱ new deal removes Microsoft’s first right of refusal, meaning OpenAI can use additional cloud providers without offering Microsoft the first chance to host new ￰18￱ has already partnered with Oracle to support the Stargate Project data ￰19￱ so, OpenAI has committed to spending $250 billion on Azure usage under the new ￰20￱ Nadella, Microsoft’s chairman and CEO, said the company is increasing investments across AI infrastructure and talent.

“Our planet‑scale cloud and AI factory, together with Copilots across high-value domains, is driving broad diffusion and real‑world impact,” he ￰21￱ said the company is continuing to invest to meet growing ￰22￱ Hood, Microsoft’s chief financial officer, said the quarter exceeded expectations in revenue, operating income, and earnings per ￰23￱ said the growth reflects continued demand for Microsoft’s cloud ￰24￱ is expanding AI tools in its consumer ￰25￱ this year, the company introduced Copilot+ PCs, and this month it rolled out updates to Windows 11 that allow users to speak to the Copilot chatbot through voice ￰26￱ is also adding Copilot integrations into its Xbox gaming ￰27￱ you're reading this, you’re already ￰28￱ there with our newsletter .