Microsoft posts $92.3 billion quarter, 10th straight record

Microsoft's latest quarter extends a run that now stretches to 10 consecutive periods of record revenue, and the profit picture is strengthening alongside it. Net income rose 32% on a GAAP basis, a faster pace than the 19% revenue growth, which suggests the mix is shifting toward higher-margin cloud services. Microsoft Cloud was the main driver at $63.9 billion, up 30%, and within that Azure brought in $33.2 billion while Microsoft 365 accounted for nearly $28 billion.

The company has also reorganized its reporting into two segments, Agents and Infra and Devices and Consumer. That split makes the contrast sharper: Devices and Consumer revenue was $15.5 billion, down 3%, with Windows OEM and devices revenue falling 22% from the year-ago quarter. The AI connection is visible in the $10 billion Microsoft reported from OpenAI, which still runs much of its services on Microsoft's cloud even after branching out to AWS, Oracle, and others. Microsoft also said its commercial remaining performance obligation increased 73% to $677 billion, representing future revenue committed under existing contracts.

That backlog comes with a cost. Capital expenditures topped $45.2 billion, another all-time quarterly record, as Microsoft spends to prepare to deliver on those commitments. The tension between record profit and record spending is likely to shape how investors read the next few quarters.