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Outbyte PC Repair FREEClear out junk files and repair common Windows errorsFree Scan →Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Microsoft makes money from Azure and other cloud services through usage-based charges, from Microsoft 365 through subscriptions and software licenses, and from AI through those same channels—especially Azure AI services and Microsoft 365 Copilot. The company does not report a standalone AI revenue total in the cited figures, so AI is best understood as part of broader product lines rather than a separately quantified business.
Microsoft’s main revenue streams
Microsoft earns revenue from cloud services, software subscriptions and licenses, support, advertising, and devices. In its fiscal 2025 annual report, the company described its business as offering cloud-based solutions and services, licensing and supporting software, delivering online advertising, and designing and selling devices. The figures below focus on Azure, Microsoft 365, and AI, not the full range of Microsoft’s businesses. Microsoft FY2025 annual report.
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For fiscal 2025, Microsoft reported $281.7 billion in total revenue. Azure and other cloud services generated more than $75 billion, up 34% from the prior year. Microsoft Cloud revenue was $168.9 billion, up 23%, but that broader company-defined aggregate is not Azure revenue. Microsoft FY2025 results.
How Azure generates revenue
Azure monetizes cloud computing and AI services primarily through consumption: customers pay to use computing, storage, databases, and other cloud capabilities. Microsoft’s reported “Azure and other cloud services” category is broader than Azure infrastructure alone. It also includes cloud and AI consumption-based services, GitHub cloud services, Nuance Healthcare cloud services, virtual desktop offerings, and other cloud services. Consequently, the category’s growth rate should not be read as a measure of one Azure product. Microsoft FY2026 investor metrics.
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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.
Microsoft reported that Azure and other cloud services revenue grew 41% in fiscal 2026. This is a growth rate for that defined category, not a disclosed dollar total for Azure alone in the cited fiscal 2026 metrics. Microsoft FY2026 investor metrics.
How Microsoft 365 generates revenue
Microsoft 365 brings in money through recurring commercial and consumer subscriptions, as well as licensed products. The reported figures differ depending on whether they measure cloud subscriptions alone or a wider category that also includes on-premises software.
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- With 16 GB of memory, runs as many programs as you want without losing the execution
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- 512 GB SSD is enough to store your essential documents and files, favorite songs, movies and pictures
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Commercial subscriptions and cloud services
Microsoft defines Microsoft 365 Commercial cloud revenue to include subscriptions covering Microsoft 365 Commercial, Enterprise Mobility + Security, the cloud portion of Windows Commercial, the per-user portion of Power BI, Exchange, SharePoint, Teams, Microsoft 365 Security and Compliance, and Microsoft 365 Copilot. Revenue from this category grew 15% in fiscal 2025, while seats grew 6%. In fiscal 2026, Microsoft reported 17% growth in Microsoft 365 Commercial cloud revenue. These are annual growth rates for the company’s defined commercial cloud category, not total Microsoft 365 revenue. FY2025 investor metrics; FY2026 investor metrics.
Commercial products, including on-premises licenses
Microsoft’s FY2025 annual report recorded $87.767 billion in revenue from Microsoft 365 Commercial products and cloud services. That broader annual-report category includes Microsoft 365 Commercial cloud as well as on-premises Windows Commercial and Office licensed on-premises. It is therefore not interchangeable with the cloud-only growth measure. Microsoft FY2025 annual report.
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- WITH AI BUILT IN — With a dedicated AI chip (Qualcomm Snapdragon X2 Elite), this Copilot+ PC[5] on Windows 11 helps you work smarter and faster. Prompt, create, and automate with ease - ready for even your most demanding tasks.
- A 13.8" TOUCHSCREEN YOU'LL ACTUALLY USE — Sharp colors, real detail, smooth 120Hz scrolling on the PixelSense touchscreen[1] with LCD display[2]. Tap, scroll, or pinch to zoom - whichever feels right for streaming, editing photos, or daily work.
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Consumer subscriptions and products
For fiscal 2025, Microsoft reported 89 million Microsoft 365 Consumer subscribers and 11% growth in Microsoft 365 Consumer cloud revenue. Its consumer category also groups subscriptions with on-premises Office licenses and other consumer services; the reported growth figure is specifically for cloud revenue, not for a separately reported AI contribution. Microsoft FY2025 investor metrics.
Where AI fits into Microsoft’s business
Microsoft monetizes AI through products and services already included in its cloud and subscription businesses. Azure’s reported category includes cloud and AI consumption-based services, while Microsoft 365 Commercial cloud includes Microsoft 365 Copilot. Customers can therefore pay for AI through cloud usage or through a subscription that includes Copilot, depending on the product and plan. Azure and other cloud services definition; Microsoft 365 Commercial cloud definition.
Rank #4
- A PREMIUM PERFORMANCE LAPTOP — Ready for work, school, and creativity. Built for busy days, big projects, and nonstop multitasking. Run video calls, school and work apps, 20+ browser tabs, and AI tools at the same time without slowing down.
- WITH AI BUILT IN — With a dedicated AI chip (Qualcomm Snapdragon X2 Elite), this Copilot+ PC[5] on Windows 11 helps you work smarter and faster. Prompt, create, and automate with ease - ready for even your most demanding tasks.
- A 15" TOUCHSCREEN YOU'LL ACTUALLY USE — Sharp colors, real detail, smooth 120Hz scrolling on the PixelSense touchscreen[1] with LCD display[2]. Tap, scroll, or pinch to zoom - whichever feels right for streaming, editing photos, or daily work.
- 19 HOURS OF BATTERY (LEAVE THE CHARGER) — Up to 19 hours of video playback[3] on a single charge. Work from a coffee shop, take it to class/work, or binge an entire season on a long flight — it'll keep up.
- Two USB-C / USB4[4] ports and a microSD card reader for fast charging, big file transfers, or hooking up to three 4K monitors when you want a full desktop. Wi-Fi 7 keeps you online and fast wherever you are.
The cited company materials do not provide a standalone Microsoft AI revenue total. They support describing AI as part of Azure consumption services and Microsoft 365 subscriptions, but not assigning AI a separate dollar figure or attributing all growth in those categories to AI.
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How to read Microsoft’s cloud revenue figures
Microsoft Cloud is a useful measure of the scale of its cloud-oriented businesses, but it is an aggregate rather than a single product or a synonym for Azure. Microsoft defines it to include Microsoft 365 Commercial cloud, Azure and other cloud services, the commercial portion of LinkedIn, and Dynamics 365. The annual report records components across multiple revenue rows, so adding Microsoft Cloud to those components would double-count revenue. Microsoft Cloud definition and FY2026 metrics.
Best Value
- Brilliant Display – Stunning 13.8" PixelSense touchscreen[1], with brilliant LCD display[2], unleashes luminous whites, deeper blacks and colors so richly saturated bringing vivid life into every frame – perfect for work, school, streaming and creative tasks.
- 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.
Microsoft reported $214.4 billion in Microsoft Cloud revenue in fiscal 2026. In fiscal 2025, the aggregate was $168.9 billion. Those totals refer to Microsoft’s defined Microsoft Cloud category—not Azure alone—and should not be added to the revenue figures for its constituent businesses. FY2026 investor metrics; FY2025 results.
| Measure | Fiscal 2025 | Fiscal 2026 | What it covers |
|---|---|---|---|
| Azure and other cloud services | More than $75 billion in revenue; up 34% | Revenue up 41%; dollar total not stated in the cited FY2026 metrics | Azure and other cloud services, including cloud and AI consumption services, GitHub cloud services, Nuance Healthcare cloud services, virtual desktop offerings, and other cloud services. |
| Microsoft 365 Commercial cloud | Revenue up 15%; seats up 6% | Revenue up 17% | Defined commercial subscription and cloud services category, including Microsoft 365 Copilot. |
| Microsoft Cloud | $168.9 billion in revenue; up 23% | $214.4 billion in revenue | Aggregate including Microsoft 365 Commercial cloud, Azure and other cloud services, commercial LinkedIn, and Dynamics 365. |
Fiscal 2025 figures come from Microsoft’s annual results and investor metrics; fiscal 2026 figures come from the company’s investor metrics, which note that information is unaudited unless otherwise indicated. The measures have different reporting boundaries, so compare like with like and retain the category name when quoting a number. Microsoft FY2026 investor metrics.
Cloud growth also has costs
Microsoft reported a 69% Microsoft Cloud gross margin in fiscal 2025. The company said that scaling AI infrastructure pressured the margin, partially offset by efficiency gains in Azure. This shows that rapid cloud and AI expansion requires investment; it does not reveal a separate AI margin or the profitability of any one AI product. Microsoft FY2025 results.
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