Microsoft has disclosed for the first time that its Azure platform generated $33.2 billion in revenue during the July to September quarter, marking a significant 48% increase from the same period last year. This is a notable departure from previous practices, where the company only shared growth percentages or general revenue milestones.
This new information allows investors to more accurately compare Azure’s financial performance with competitors such as Amazon Web Services and Google Cloud, which consistently report their cloud revenue in dollar amounts.
On the same day, Alphabet revealed that its Google Cloud earnings reached $30.7 billion for the corresponding quarter. This puts Azure slightly ahead in terms of revenue. However, Google Cloud, which also includes revenue from Google Workspace subscriptions, experienced a growth rate nearly double that of Azure, according to calculations made by TechCrunch.
Azure has become Microsoft’s largest and fastest-growing segment, accounting for approximately 36% of the company’s total quarterly revenue of $92.3 billion. Businesses utilize Azure to rent computing services for applications, SaaS, and developing AI models.
In addition, Azure’s revenue exceeded analysts’ expectations by about $850 million, outperforming the projected $32.3 billion. The reported 48% growth also surpassed Microsoft CFO Amy Hood’s forecast of 44% to 45% during a prior earnings call in July.
Azure is categorized under a new business segment called Agents and Infra, which is one of two segments Microsoft introduced this quarter. The new structure replaces the previous three segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The Agents and Infra segment, which combines Azure with Microsoft 365’s cloud solutions, generated $76.8 billion, reflecting a 25% increase compared to last year.
Amazon is set to announce its earnings on Thursday, with analysts anticipating growth for its cloud platform, Amazon Web Services. Having held the title of the largest cloud provider since its inception, Amazon remains a formidable competitor for Microsoft, though with clearer revenue figures emerging, the competition is intensifying.
