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Microsoft to Start Disclosing Azure Quarterly Revenue as It Consolidates Segments

Microsoft will begin reporting Azure quarterly revenue and consolidate into two business segments, giving investors clearer insight into AI-driven cloud growth.

AI News Feed · 2026-09-03 13:08

The change, outlined in a Microsoft presentation on Wednesday, will give investors a clearer view of the Azure unit that competes with Amazon Web Services and Google Cloud. Microsoft previously disclosed only the year-over-year growth rate for Azure and had begun providing annual actual sales only last year. The prior three-segment structure had been in place since 2015. Amazon has reported AWS revenue since 2015, and Alphabet has reported its cloud business since 2020.

Azure has been one of the main beneficiaries of the artificial intelligence boom, with customers using large cloud platforms for access to AI models. Analysts at Stifel estimated in July that roughly half of Azure's revenue growth in Microsoft's 2026 fiscal year came from OpenAI, and Anthropic has also become more reliant on Microsoft's cloud.

"There's no question AI represents a profound shift in both technology and business," Microsoft CEO Satya Nadella wrote in the presentation. "It is changing what we build and how we operate, and it is blurring the boundaries between our products and reshaping our business models."

Under the new definition, Azure will no longer include GitHub cloud services, developer cloud services, the Security Copilot assistant, and healthcare and life sciences cloud products, according to the presentation. In 2021 Microsoft had begun reporting growth for Azure and other cloud services and later included some revenue from GitHub and Nuance Communications acquisitions. Nadella said the new Azure would become 'more purely our consumption-based platform and infrastructure business.'

Microsoft's two new segments will be Agents and Infra and Devices and Consumer. Agents and Infra will include Azure, Microsoft 365 cloud products, productivity and server licensing, industry solutions, and support services. Devices and Consumer will include search and advertising, Xbox, and revenue from device sales and Windows operating-system licenses to device makers. The Agents and Infra structure is designed to show momentum for AI assistants including Microsoft 365 Copilot for commercial customers and GitHub Copilot. Microsoft said in July that Microsoft 365 Copilot for commercial customers had more than 30 million paid seats, up from more than 20 million as of April.

Microsoft will provide two years of recast financial results and adjusted guidance but will stop reporting costs and operating margins for the old segments. Under the new definition, Azure revenue grew 42 percent to $29.42 billion in the June quarter, compared with 43 percent under the previous Azure and other cloud services measure. Azure represented almost 33 percent of Microsoft's total revenue in the quarter.