Net income for the period rose to $35.8 billion, while operating income reached $40.6 billion, reflecting strong demand for enterprise digital transformation tools.
The Intelligent Cloud segment remained a key performer, as Azure and other cloud services saw revenue growth of 43%.
CEO Satya Nadella noted that Azure's annual revenue exceeded $100 billion for the first time, and the Microsoft 365 Copilot AI service reached 30 million paid seats.
In contrast, the More Personal Computing division experienced a 4% decline in revenue, impacted by a 10% decrease in Xbox content and services and a 7% drop in Windows OEM and devices revenue.
The company’s financial results were also influenced by several discrete items, including a $3.2 billion gain from an investment in Anthropic and adjustments related to its partnership with OpenAI.
While productivity and business process revenue grew by 14%, Microsoft faced offsetting costs from impairment charges in its gaming division and expenses related to severance.
During the quarter, the company returned approximately $10.2 billion to shareholders through dividends and share repurchases.