Azure and Microsoft Stock: How Azure Growth Moves the Shares

Most firms no longer buy every server they use. They rent computing power by the hour from a few giant cloud firms, and the rush to build and run AI models has made that rental trade the fastest-growing part of big tech. A customer's bill goes up and down with how much it uses, so the cloud firm's sales do too.

That gives one number a lot of power. A cloud's growth rate comes out a few minutes after the stock market closes, and it can move a company worth trillions of dollars more than its profit does. It is also easy to misread, because firms change what they count in it, give it two ways and set it against a target they chose themselves.

The fix is to read the cloud line the way the firm defines it. Look at the dollars it earned, the growth rate with and without the effect of exchange rates, the range the firm said to expect, and the bar investors had set. Read together, those four figures explain much of what the share price does on the night of a report.

For Microsoft, that line is Azure. Microsoft stock (MSFT) trades on Nasdaq, and BloFin tracks its price with the MSFTUSDT Perpetual, a perpetual futures contract settled in USDT. If you hold a position, the Azure figure in each quarterly report is one of the main things that moves it.

What is Azure?

Azure is Microsoft's cloud: firms rent its servers, storage and AI tools and pay for what they use. On the way Microsoft has counted it since September 2026, Azure made $101.9 billion in fiscal 2026, or 30.7% of Microsoft's sales (source: Microsoft segment slides). It then made $33.2 billion in July to September 2026 alone (source: Microsoft first quarter fiscal 2027 results).

In its September 2026 quarterly filing, Microsoft describes Azure as the cloud that firms pay for as they use it: computing, data, storage, networking and security. It also holds the AI chips that customers rent, and Foundry, a tool for building AI apps (source: Microsoft 10-Q for July to September 2026). Its annual report says Azure's sales depend mostly on how much customers use its servers and the tools that run on them (source: Microsoft 10-K for fiscal 2026). Say your firm runs its online shop on 10 Azure servers and then moves to 20 when a new AI tool goes live. Your bill doubles the next month, and so does what Microsoft books from you, with no new contract signed.

Microsoft's fiscal year ends on June 30. Fiscal 2026 ran from July 2025 to June 2026, and the July to September 2026 quarter is the first quarter of fiscal 2027. Azure sits in Agents and Infra, the larger of Microsoft's two segments, next to Microsoft 365, GitHub and Dynamics (source: Microsoft first quarter fiscal 2027 results). It is the biggest of the eight product lines behind how Microsoft makes money.

How Microsoft redefined Azure in September 2026

In September 2026 Microsoft moved three units out of Azure. GitHub's cloud and Security Copilot went to Microsoft 365 commercial cloud, and its health care cloud went to a new line called Industry solutions cloud. Chief executive Satya Nadella wrote that the change makes Azure more purely Microsoft's pay-per-use platform and server business (source: Microsoft segment slides).

The new basis took about one point off Azure's growth for the April to June 2026 quarter and for the full year. The first three quarters came out the same on both bases (source: Microsoft segment slides). Constant currency means growth with exchange-rate swings removed, which tells you how much more customers bought, rather than how far the dollar moved.

Both sets of figures are right for their own basis. Microsoft's October 28, 2026 report gave its first quarterly results on the new basis. So the 43% in July's headlines is the wrong yardstick for the 48% that came next (source: Microsoft first quarter fiscal 2027 results).

Azure revenue and growth by quarter

Azure's sales rose in every quarter on the new basis, from $22.4 billion in July to September 2025 to $33.2 billion in July to September 2026. That is a gain of $10.8 billion, or 48.2%, in one year. Growth ran between 39% and 42% through fiscal 2026, then jumped to 48% (source: Microsoft segment slides) (source: Microsoft first quarter fiscal 2027 results).

You can check any of these rates yourself. Divide a quarter's sales by the same quarter a year before: for July to September 2026, $33.2 billion against $22.4 billion is 48.2% more, using Microsoft's figures in millions (source: Microsoft first quarter fiscal 2027 results). Microsoft's currency table for that quarter shows exchange rates had no effect on Azure's growth, so both measures read 48%.

The trend matters as much as the level. Growth dipped to 39% in October to December 2025 and rose back to 40% in January to March 2026. It then rose to 42% in April to June and 48% in July to September, each time against a bigger base. Speeding up from a bigger base takes more new business. Azure added $3.7 billion of quarterly sales from April to June to July to September 2026, against $1.7 billion over the same months of 2025 (source: Microsoft segment slides) (source: Microsoft first quarter fiscal 2027 results).

Why Azure growth moves Microsoft stock

Azure moves Microsoft stock because it supplies most of the company's growth. In fiscal 2026 Azure made 30.7% of Microsoft's sales but 58.5% of the year's $50.1 billion rise in sales (source: Microsoft segment slides). The rest of Microsoft grew 9.9% that year, so Azure's growth rate does much to set the whole company's.

In July to September 2026, Azure's share was higher still. It added $10.8 billion of the $14.6 billion rise in Microsoft's quarterly sales, or 73.8%, while the rest of Microsoft grew 6.9% (source: Microsoft first quarter fiscal 2027 results). Investors price a company on how fast its profit can grow for years to come. The line growing about seven times as fast as the rest of the business carries most of that view.

One point of Azure growth is easy to put in dollars, too. Microsoft's range for October to December 2026 is set against $24.1 billion of Azure sales a year before. So each point is worth about $241 million in that quarter (source: Microsoft segment slides). That is under 0.3% of Microsoft's sales in the same quarter of 2025. Yet a point or two on Azure has come with some of the stock's biggest one-day moves.

Microsoft's Azure guidance and the market's expectation

Each quarter Microsoft gives a range for Azure's next-quarter growth in constant currency. Azure beat that range in all four quarters of fiscal 2026, yet the share price fell the next day after three of those reports. The bar that moves the stock is what investors expect, and it can sit higher than Microsoft's own range.

Microsoft gave its range on each earnings call. It was about 37% for July to September 2025 (source: Microsoft July 2025 earnings call) and about 37% again for October to December (source: Microsoft October 2025 earnings call). It was 37% to 38% for January to March (source: Microsoft January 2026 earnings call) and 39% to 40% for April to June (source: Microsoft April 2026 earnings call).

Growth is shown on the Azure basis in use at the time. The stock moves come from Nasdaq closing prices on the report day and the next trading day (source: Yahoo Finance MSFT history).

The two biggest nights show how this works. On January 28, 2026, Azure's 39% as reported only just cleared the 38.8% analysts expected, on Visible Alpha data cited by Reuters. The same report showed record capital spending of $37.5 billion, against an expected $34.3 billion. Reuters reported the shares down 6.5% after hours (source: Reuters via Yahoo Finance), and they closed the next day 10.0% lower.

Six months later, the gap ran the other way. On July 29, 2026, Azure grew 43% against a consensus of about 40%. Microsoft guided to about 45% for the next quarter, when analysts had pencilled in about 41%, again on Visible Alpha figures (source: Reuters via Zawya). Reuters put the after-hours gain at more than 8% and wrote that the numbers were a sign Microsoft's AI spending was paying off. The shares closed the next day 15.5% higher.

So the Azure number is read in pairs: growth against what investors expected, and growth against the money Microsoft spends on AI capacity, which hit a record in the quarter that sank the stock. Moves this big are the reason to plan around the Azure line when trading Microsoft around its earnings.

If you follow these moves on the MSFTUSDT Perpetual page, the first number to find in each report is Azure's growth in constant currency, set against both Microsoft's range and the consensus.

Azure capacity limits

Azure's growth depends on how many servers Microsoft can bring online, as well as on how much customers want. On every earnings call from October 2025 to October 2026, finance chief Amy Hood said customers wanted more than Azure could supply (source: Microsoft October 2025 earnings call) (source: Microsoft October 2026 earnings call). In July 2026 she called it a relatively extreme moment (source: Microsoft July 2026 earnings call).

The date she expected the shortage to end moved out during fiscal 2026. In October 2025 Hood said Microsoft would be short of capacity through at least June 2026, the end of its fiscal year (source: Microsoft October 2025 earnings call). In April 2026 she pushed that to at least the end of 2026, and said Azure had beaten its range that quarter partly because new capacity came online earlier (source: Microsoft April 2026 earnings call). In October 2026 she gave no new end date. She said demand still ran ahead of supply. Some AI chip capacity that Microsoft rents from other firms had also slipped to January to June 2027 (source: Microsoft October 2026 earnings call).

Microsoft also has to share its servers with itself. Its own AI tools, such as Microsoft 365 Copilot, run on the same chips that paying Azure customers want. In January 2026 Hood said that if all the AI chips added in the past two quarters had gone to Azure, its growth rate would have been above 40%, against the 39% it reported (source: Microsoft January 2026 earnings call).

Hood has also warned that Azure's growth can vary from quarter to quarter with the timing of new servers and the mix of contracts (source: Microsoft July 2026 earnings call). In October 2026 she added two more causes: when efficiency gains land, and which AI models customers pay for (source: Microsoft October 2026 earnings call). For you, that means a slower quarter can reflect when servers were switched on as much as what customers wanted. The earnings call is where Microsoft says which it was.

The Microsoft Cloud metric and its gross margin

The Microsoft Cloud is a wider measure that puts Azure together with Microsoft 365 commercial cloud and the Industry solutions cloud line (source: Microsoft segment slides). On the new basis it brought in $63.9 billion in July to September 2026, up 30%, or 31% in constant currency (source: Microsoft first quarter fiscal 2027 results). Microsoft also reports its gross margin each quarter.

Gross margin here is the share of cloud sales left after the direct cost of the service, such as the data centers, chips and power behind it. Microsoft's cloud gross margin was 68% in July to September 2025 (source: Microsoft October 2025 earnings call). It then fell by one point a quarter through the rest of fiscal 2026, to 67% in October to December (source: Microsoft January 2026 earnings call), 66% in January to March 2026 (source: Microsoft April 2026 earnings call) and 65% in April to June (source: Microsoft July 2026 earnings call). It was back at 66% in July to September 2026, two points below a year earlier, and Hood guided to roughly 65% for October to December (source: Microsoft October 2026 earnings call).

Hood tied the fall in fiscal 2026 to the shift in sales toward Azure and to more spending on AI data centers (source: Microsoft July 2026 earnings call). That implies Azure keeps less of each dollar than the rest of the Microsoft Cloud. So each step in the mix toward Azure pulls the joint margin down, even while both parts grow. In October 2026 she said Azure's own margins had improved, which only partly offset that mix shift (source: Microsoft October 2026 earnings call).

That is the trade-off investors weigh each quarter: Azure brings faster growth and a thinner margin, while Microsoft 365 seats, including how much Copilot earns Microsoft, are billed per user and grow more slowly. In July 2026 the market rewarded faster Azure growth along with a cloud margin that came in better than Microsoft had expected (source: Microsoft July 2026 earnings call).

Azure's backlog and OpenAI's share

Commercial remaining performance obligation (RPO) is Microsoft's backlog: sales that customers have signed for but Microsoft has not yet earned, including long Azure deals with AI firms. On September 30, 2026 the backlog came to $677 billion, 73% more than a year before. Roughly 30% of it should become sales in the next 12 months, Hood said (source: Microsoft October 2026 earnings call).

One customer makes up a big part of it. In January 2026 Hood said about 45% of the $625 billion backlog at December 31, 2025 came from OpenAI, the maker of ChatGPT (source: Microsoft January 2026 earnings call). That share comes to about $281 billion of signed sales, while the other 55%, roughly $350 billion in her words, came from the rest of Microsoft's customers.

By June 30, 2026 the mix had started to shift. Hood said the backlog grew 25% with OpenAI left out, against 84% in total. All of its growth since the March quarter came from customers outside the firms that build the most advanced AI models (source: Microsoft July 2026 earnings call). The October 2026 report gave no new OpenAI share. Hood said the backlog dipped less than usual for the season because of one large Azure commitment, and she did not name the customer (source: Microsoft October 2026 earnings call). On average, the backlog runs for 2.3 years.

For Azure, a backlog this big supports growth for years, but it also ties a large part of that growth to one customer. OpenAI is also a firm Microsoft has invested in, so its name shows up twice in Microsoft's numbers. It is an Azure customer in the backlog, and it is Microsoft's stake in OpenAI further down the income statement, where Microsoft's guidance for other income leaves it out (source: Microsoft segment slides).

Azure, AWS and Google Cloud

Amazon Web Services (AWS) is the largest of the three big US cloud firms by quarterly sales, and Azure is second. In April to June 2026, AWS sales were $42.2 billion, up 37%, Azure's were $29.4 billion, up 42% on the new basis, and Google Cloud's were $24.8 billion, up 82% (source: Amazon second quarter 2026 results) (source: Alphabet second quarter 2026 results) (source: Microsoft segment slides).

The three figures are counted in different ways. Google Cloud's total includes Workspace, Google's office apps, and sales of its TPU chip systems (source: Alphabet second quarter 2026 results). Microsoft's office apps sit in Microsoft 365, outside Azure. Azure's 42% is also set against a much bigger base than Google Cloud's 82%, which grew from $13.6 billion a year before.

Google Cloud's reported sales are closing in on Azure's. In July to September 2026 Google Cloud made $30.7 billion, up 103%, while Azure made $33.2 billion, up 48% (source: Alphabet third quarter 2026 results) (source: Microsoft first quarter fiscal 2027 results). Alphabet said sales of its TPU chip systems were a meaningful part of that growth (source: Alphabet third quarter 2026 results). Azure's line counts only services that customers pay for as they use them, rented AI chips among them (source: Microsoft 10-Q for July to September 2026). Azure's lead narrowed from $4.6 billion in April to June to $2.5 billion.

So the comparison tells you more about each firm's own trend than about who is winning customers. That mix of AI chips and office apps is part of what moves Google Cloud and Alphabet stock. Microsoft meets the same rivals again in office software, search and games, as the list of Microsoft's competitors by business shows.

Microsoft's first report on the new Azure basis

Microsoft's first report on the new Azure basis came on October 28, 2026, for July to September 2026. Azure grew 48% in constant currency, three points above the top of the 44% to 45% range Microsoft had set in September on the same new definition (source: Microsoft first quarter fiscal 2027 results) (source: Microsoft segment slides). Azure has now beaten Microsoft's own range in five straight quarters.

The fair test is the September range. In July, Microsoft had guided to about 45% on the old definition, which still held GitHub's cloud, Security Copilot and the health care cloud (source: Microsoft July 2026 earnings call) (source: Microsoft segment slides). The redefinition took up to a point off that target. Set against July's 45%, the beat looks like three points. Against the September range it was three to four.

Hood said Azure beat the range even with the delayed outside capacity. She gave two reasons. Foundry's sales more than tripled in a year, and Microsoft's engineers found spare room on its ordinary servers that it could sell to customers (source: Microsoft October 2026 earnings call). For October to December 2026, Hood guided to Azure growth of 49% to 50% in constant currency. She said better use of existing chips should help make up for some rented capacity that slipped into 2027.

Azure's figure for the three months to December 2026 comes with Microsoft's report for that quarter, which Microsoft usually releases in late January. When it comes out, read four things in order. First, Azure's growth in constant currency against the 49% to 50% range. Second, the same figure against the consensus, which news services publish that evening. Third, what Hood says on the call about capacity and the following quarter's range. Fourth, the change in the backlog and any update on how much of it comes from OpenAI.

Microsoft puts out its results after Nasdaq's 4PM ET close, which is 9PM UTC in January. Its October 2026 call with analysts began at 5.30PM ET, 9.30PM UTC (source: Microsoft earnings date notice). On BloFin, the MSFT perpetual can be held to reduce-only orders whenever US markets are shut. So in the first hours after the Azure figure, cutting or closing a trade should be possible, while a new or larger position may need to wait until Nasdaq opens.

Looking to trade Microsoft around its Azure results with crypto? To get started, you'll need to first create a BloFin account, fund your account with cryptocurrency, and go to the MSFTUSDT Perpetual trading page.

Frequently asked questions

Does Microsoft report Azure revenue in dollars?

Microsoft now gives Azure's sales in dollars every quarter. Its October 2026 release put Azure at $33.2 billion for July to September 2026 (source: Microsoft first quarter fiscal 2027 results). Its September 2026 slides restated Azure's quarterly sales back to July 2024. Satya Nadella wrote that the new setup gives investors full transparency of quarterly sales for Azure and its other key units (source: Microsoft segment slides). Before that, Microsoft's reports gave Azure as a growth rate inside the wider Intelligent Cloud segment, and its size came out only as round yearly totals on earnings calls.

When did Azure pass $100 billion in annual revenue?

Azure passed $100 billion in fiscal 2026, the year to June 30, 2026. On July 29, 2026, Satya Nadella told analysts that Azure had passed $100 billion, up 41% on the basis used then (source: Microsoft July 2026 earnings call). A year earlier he had said it passed $75 billion, up 34% (source: Microsoft July 2025 earnings call). On the new basis the fiscal 2026 total is $101.9 billion, and the four quarters to September 30, 2026 add up to $112.7 billion (source: Microsoft segment slides) (source: Microsoft first quarter fiscal 2027 results).

Who is Azure's biggest customer?

OpenAI is the Azure customer Microsoft talks about most, though it publishes no ranking of customers. In October 2025 Microsoft said OpenAI had made new Azure commitments of $250 billion, announced the day before its earnings call (source: Microsoft October 2025 earnings call). Microsoft also says that in fiscal 2026, nearly 90% of Microsoft Cloud sales came from customers outside the firms that build the most advanced AI models, such as OpenAI (source: Microsoft July 2026 earnings call).

Is Copilot revenue counted in Azure?

Microsoft 365 Copilot, GitHub Copilot and Security Copilot are all counted in Microsoft 365 commercial cloud, the line next to Azure. Azure earns from AI in a different way. Firms that build their own AI apps on Foundry, or rent AI chips to run their own models, pay Azure for what they use (source: Microsoft 10-Q for July to September 2026).

What happened to Microsoft's Intelligent Cloud segment?

Intelligent Cloud was the segment that held Azure, Microsoft's server products and its support services for big firms until fiscal 2026. From fiscal 2027 Microsoft reports those units inside Agents and Infra (source: Microsoft segment slides). In its last year, Intelligent Cloud had sales of $137.8 billion and operating income of $57.0 billion. That was about 41.5% of Microsoft's sales. Agents and Infra is larger, because it also holds Microsoft 365 and Microsoft's other business software.

Researched and written by the BloFin Academy editorial team with AI-assisted drafting. All facts independently verified. Primary sources include Microsoft's FY27 segment slides filed with the SEC in September 2026, its annual report on Form 10-K for fiscal 2026, its first quarter fiscal 2027 results and Form 10-Q, its earnings calls from July 2025 to October 2026, its October 7, 2026 earnings date notice, Reuters reports on the January and July 2026 results, Yahoo Finance price history, Amazon's second quarter 2026 results, and Alphabet's second and third quarter 2026 results, current as of October 29, 2026.

Nothing in this article constitutes financial advice, and nothing in it is a recommendation to buy, sell or hold Microsoft in any form. The market judges Azure against analysts' expectations as well as Microsoft's own range, so a quarter that beats the range can still send the share price sharply lower, as it did in January 2026. A leveraged MSFTUSDT Perpetual position magnifies a move like that, the first reaction to a report arrives when new positions may be restricted, and a position can be liquidated before the market settles. Past performance does not indicate future results. Do your own research and consider your risk tolerance before you trade on BloFin.