Microsoft makes money from cloud and AI services, business and consumer software subscriptions, Windows licensing, gaming, devices, advertising, LinkedIn, and business applications and services. Its latest full-year result in the sources reviewed is $331.8 billion in revenue for FY2026, the year ended June 30, 2026. The latest detailed breakdown by product and service is for FY2025, so those category figures should not be mistaken for FY2026 results.
How Microsoft reports its business
Microsoft reports three operating segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. These segments group related activities for financial reporting; they are not a complete list of individual products or revenue sources.
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Microsoft Cloud is a separate management measure, not a fourth segment. Its definition includes Microsoft 365 Commercial cloud, Azure and other cloud services, commercial LinkedIn, and Dynamics 365. Because it spans parts of more than one segment and overlaps product categories, adding Microsoft Cloud to those categories would count revenue twice.
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How much money does Microsoft make?
For FY2026, ended June 30, 2026, Microsoft reported $331.8 billion in revenue, up 18% year over year, and $155.2 billion in operating income, up 21%. Revenue is money earned before expenses; operating income is what remains after operating expenses, before items such as interest and taxes.
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The latest detailed annual product-and-service figures available in the sources reviewed are from FY2025, ended June 30, 2025. The categories below are Microsoft-reported amounts in US dollars; they are not the three operating segments.
| FY2025 product or service category | Revenue | What it includes or represents |
|---|---|---|
| Server products and cloud services | $98.435 billion | Server products and cloud services, including Azure and other cloud services; this is not an Azure-only figure. |
| Microsoft 365 Commercial products and cloud services | $87.767 billion | Commercial Microsoft 365 products and cloud services. |
| Gaming | $23.455 billion | Gaming hardware, content, subscriptions, and related services. |
| $17.812 billion | LinkedIn products and services. | |
| Windows and Devices | $17.314 billion | Windows OEM licensing and devices such as Surface; the report combines them. |
| Search and news advertising | $13.878 billion | Advertising across search and news properties and related channels. |
| Dynamics products and cloud services | $7.827 billion | Dynamics products and cloud services. |
| Enterprise and partner services | $7.760 billion | Enterprise and partner services. |
| Microsoft 365 Consumer products and cloud services | $7.404 billion | Consumer Microsoft 365 products and cloud services. |
| Total revenue | $281.724 billion | Microsoft’s FY2025 total, not an additional product category. |
Microsoft separately reported $168.9 billion of Microsoft Cloud revenue in FY2025. That is an overlapping subtotal, not an amount to add to the table. At its 2025 annual shareholder meeting, management also rounded some FY2025 figures: Azure revenue was above $75 billion, Microsoft 365 commercial and consumer revenue above $95 billion, LinkedIn revenue above $17 billion, and Gaming revenue above $23 billion. Those rounded statements are useful context, while the annual-report table provides more precise figures for its listed categories.
Where Microsoft’s revenue comes from
Azure and cloud infrastructure
Organizations pay Microsoft to use cloud computing, storage, databases, AI services, and related infrastructure. Much of this business is consumption-based: customers pay for the resources and services they use, alongside other commercial arrangements. Microsoft’s Azure and other cloud services measure also includes GitHub cloud services, Nuance Healthcare cloud services, virtual desktop offerings, and other cloud services. It is therefore broader than Azure alone.
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The FY2025 shareholder-meeting summary put Azure revenue above $75 billion, but the detailed annual product table does not give Azure as a standalone line: it reports server products and cloud services together. In Q4 FY2026, Azure and other cloud services revenue grew 43% year over year. On Microsoft’s earnings call, management said customer demand exceeded available capacity and newly added capacity was quickly monetized. That describes the quarter, not a guaranteed growth rate or a fixed margin: the call also noted that Azure and AI infrastructure investment affected cloud gross margin.
Microsoft 365 and Office
Microsoft earns from both commercial and consumer Microsoft 365 products and cloud services. For businesses, subscriptions and related products can generate recurring revenue; paid seats, product tiers, and customer use of premium features can influence revenue per user. Consumer plans provide another subscription stream. Office applications are part of this broader business, rather than a single standalone line in the annual revenue table.
In Q4 FY2026, Microsoft 365 Commercial cloud revenue grew 14% year over year as reported, or 16% after adjusting for a prior-year revenue-recognition comparison. Microsoft 365 Consumer cloud revenue grew 24% in that quarter. These rates are quarterly cloud-growth figures, not full-year growth rates for all Microsoft 365 products.
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Windows licenses and devices
PC makers buy Windows OEM licenses for Windows to be preinstalled on computers they sell. Microsoft also sells its own devices, including Surface PCs and accessories. The FY2025 figure of $17.314 billion is for the combined category “Windows and Devices,” so it cannot be read as Windows-license revenue alone.
Xbox and gaming
Gaming revenue is broader than console sales. It includes Xbox hardware, first- and third-party games, in-game content, subscriptions such as Game Pass, cloud gaming, advertising, and other services. Game Pass generates subscription revenue by offering a curated library of first- and third-party titles.
In Q4 FY2026, Xbox content and services revenue declined 10% year over year. That is a result for one quarter and one part of the gaming business, not a full-year change for all Gaming revenue.
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LinkedIn and advertising
LinkedIn earns revenue through Talent Solutions, Marketing Solutions, Premium Subscriptions, and Sales Solutions. Search and news advertising is another stream: Microsoft’s category encompasses Bing and Copilot, Microsoft News, Microsoft Edge, and third-party affiliates. In Q4 FY2026, search advertising revenue excluding traffic acquisition costs increased 10% year over year.
Dynamics and business services
Dynamics products and cloud services include Dynamics 365 applications for functions such as enterprise resource planning (ERP), customer relationship management (CRM), Power Apps, and Power Automate. Microsoft also reports enterprise and partner services as a separate product-and-service category. Dynamics and commercial LinkedIn are included in Microsoft Cloud’s definition as well as appearing in their own revenue categories, which is another reason not to add the cloud subtotal to the category figures.
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How to interpret Microsoft’s latest growth figures
Microsoft’s Q4 FY2026 segment revenues were $37.8 billion for Productivity and Business Processes, $39.3 billion for Intelligent Cloud, and $12.9 billion for More Personal Computing. These are segment revenues for the quarter, not full-year totals or individual product figures.
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- Power that lasts all day – With 20 hours of battery life[3], the new Surface Laptop powers through your entire day, so you can create, work and stream from morning to night without reaching for a charger.
- Work at the speed of your ideas – Built with the latest Qualcomm Snapdragon X2 Elite (12 Core) processors, Surface Laptop delivers fast, AI‑accelerated performance—making it the most powerful Surface laptop for everything from multitasking to demanding workloads.
- The ports you need – Charge on-the-go, transfer data fast, or create the ultimate desktop set up with two USB-C / USB4[4] ports.
- Built-in AI Companion – Work smarter, create freely, and communicate with confidence—Copilot[5] on Windows 11 is always there to help.
| Q4 FY2026 measure | Year-over-year result | Scope |
|---|---|---|
| Azure and other cloud services | Up 43% | Quarterly revenue growth. |
| Microsoft 365 Commercial cloud | Up 14% reported; up 16% adjusted | Quarterly growth; adjusted figure accounts for a prior-year revenue-recognition comparison. |
| Microsoft 365 Consumer cloud | Up 24% | Quarterly revenue growth. |
| Up 12% | Quarterly revenue growth. | |
| Dynamics 365 | Up 13% | Quarterly revenue growth. |
| Windows OEM and Devices | Down 7% | Quarterly revenue growth for the combined measure. |
| Xbox content and services | Down 10% | Quarterly revenue growth for content and services, not all gaming revenue. |
| Search advertising, excluding traffic acquisition costs | Up 10% | Quarterly revenue growth. |
These indicators describe different businesses and scopes. For instance, Azure growth is not the same measure as Intelligent Cloud segment revenue, and a cloud subtotal is not interchangeable with a product category. Microsoft also said in its FY2026 Q4 earnings release that Microsoft Cloud revenue was $59.3 billion for the quarter, up 27% year over year; that cross-business measure should not be added to segment or product revenue.
What the business mix says
Microsoft’s revenue comes from a mix of recurring subscriptions and cloud usage, software and OEM licensing, devices, gaming content and services, and advertising. Commercial customers are important across cloud infrastructure, Microsoft 365, LinkedIn, and Dynamics, while consumer-facing products include Microsoft 365 Consumer, Windows-enabled devices, gaming, and advertising-supported services. The reported categories show scale, but they do not disclose a precise split of all revenue into recurring versus transactional sales or commercial versus consumer customers.
The clearest takeaway is that Microsoft is not funded by a single product. Cloud and commercial software are major sources, while Windows and devices, gaming, LinkedIn, advertising, Dynamics, and services broaden the portfolio. Microsoft’s public reporting places some overlapping activities into different views—segments, product categories, and Microsoft Cloud—so those views explain the business from different angles rather than forming separate totals to sum.
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