Microsoft has reported net income of $36.6bn for the quarter ending 30 September 2026 (Q1 FY27), representing a 32% rise compared to the same period a year earlier.
The company’s revenue for the reported quarter reached $92.3bn, an increase of 19% year on year, while operating income rose 21% to $45.9bn.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
When calculated on a non-GAAP basis, which adjusts for the impact of investments in OpenAI, Microsoft’s Q1 FY27 net income was $36.4bn, marking an 18% increase from the previous year.
Non-GAAP diluted earnings per share (EPS) were $4.89, also up 18% from the prior period. On a reported basis, diluted EPS stood at $4.92, reflecting a 32% year-on-year increase.
In terms of business segments, the Agents and Infra division generated revenue of $76.8bn, growing 25% compared with the same quarter last year.
Devices and Consumer revenue declined by 3% to $15.5bn. Microsoft Cloud revenue climbed 30% to reach $63.9bn for the quarter.
Azure, the company’s cloud computing platform, saw its revenue rise 48% year-on-year.
Microsoft 365 commercial cloud revenue in Q1 FY27 increased by 17% on a reported basis and by 18% in constant currency, when adjusting for a one-point benefit from in-period revenue recognition in the prior year.
Microsoft 365 consumer cloud revenue rose by 17% on a reported basis, or 16% in constant currency.
Industry solutions cloud revenue grew 10% over the same period. Within the Devices and Consumer unit, search and advertising revenue excluding traffic acquisition costs increased by 12%.
XBOX content and services revenue registered a 2% year-on-year decline, while Windows OEM and Devices revenue fell 22%.
The company stated its commercial remaining performance obligation increased by 73% to $677bn.
During Q1 FY27, Microsoft returned $10.2bn to shareholders through a combination of dividends and share repurchases.
Microsoft chairman and CEO Satya Nadella said: “We are delivering greater capability, choice, control, and cost efficiency for customers across our entire stack.
“By helping organisations 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.”
Recently, Microsoft introduced a voluntary buyout scheme for around 60,000 employees, accounting for over a quarter of its global staff, as the company seeks to control costs and fund ongoing investments in AI.
