Review|MSFT FY27Q1: Azure Grows 48%; Copilot Revenue Growth Accelerates

Azure growth was broadly in line with our forecast, while Copilot revenue growth accelerated. Better CPU and GPU fleet efficiency supported revenue, while delayed third-party capacity deliveries shifted capex into later periods. We are watching how large Copilot deployments translate into revenue and the timing of capacity deliveries in FY27H2.

Results at a glance

1. Revenue was $92.28b, up 19% y/y and 0.9% above the $91.46b in our Preview.
2. Azure revenue was $33.17b, up 48% y/y in constant currency, close to the 47.1% in our Preview.
3. M365 Commercial Cloud grew 18% in constant currency as reported, broadly in line with the ~18% in our Preview; adjusting for prior-year revenue recognition effects, like-for-like growth was 19%. M365 commercial paid seats grew 5%.
4. EPS excluding the OpenAI investment impact was $4.89, close to the $4.82 in our Preview.

Earnings call highlights

Copilot and M365 Commercial Cloud