● Covered by 2 sources · 2 reportsMedium impact2 neutral
Microsoft to Disclose Quarterly Azure Revenue, Consolidates Business Units
Key points
- Microsoft will disclose quarterly Azure revenue.
- Operating segments reduced from three to two.
- Azure reporting will exclude GitHub, Security Copilot, and healthcare cloud services.
- New segments are 'Agents and Infra' and 'Devices and Consumer'.
- Xbox and Windows are now part of the Devices and Consumer segment.
- Devices and Consumer includes search and advertising revenues from LinkedIn.
- Devices and Consumer includes search advertising revenue.
- Agents and Infra includes Microsoft 365 Cloud.
- Agents and Infra includes Microsoft 365 commercial and consumer.
- Agents and Infra includes server products.
- Agents and Infra includes industry solutions.
- Agents and Infra includes enterprise and partner services.
New Financial Transparency for Azure
Microsoft announced it will start disclosing quarterly revenue specifically for its Azure cloud business. This marks a shift from previous reporting, which primarily provided year-over-year growth rates and only annual sales figures since last year. The move aims to offer investors a clearer financial picture of Azure, a key competitor to Amazon Web Services and Google Cloud Platform.
Restructured Business Segments
The change in Azure reporting is part of a broader reorganization of Microsoft's operating segments, reducing them from three to two. The prior three-segment structure had been in place since 2015. The new segments are 'Agents and Infra' and 'Devices and Consumer'.
Refined Azure Scope
Under the new reporting structure, Azure's reported revenue will exclude GitHub cloud services, developer cloud services, the Security Copilot assistant, and healthcare and life sciences cloud products. CEO Satya Nadella stated this change makes Azure "more purely our consumption-based platform and infrastructure business."
Impact of AI Growth
Azure has benefited from the growth in artificial intelligence, as customers utilize major cloud infrastructure platforms for AI model access. Analysts estimated that approximately half of Azure's revenue growth in fiscal year 2026 could be attributed to OpenAI, with Anthropic also increasing its reliance on Microsoft's cloud services.
New Segment Breakdown
The 'Agents and Infra' segment will encompass Azure, Microsoft 365 cloud products, productivity and server licensing, industry solutions, and frontier and support services. The 'Devices and Consumer' segment will include search and advertising, Xbox, and revenue from device sales and Windows operating system licenses.
Updates
- Xbox and Windows are now part of the Devices and Consumer segment.
- Devices and Consumer includes search and advertising revenues from LinkedIn.
- Devices and Consumer includes search advertising revenue.
- Agents and Infra includes Microsoft 365 Cloud.
- Agents and Infra includes Microsoft 365 commercial and consumer.
- Agents and Infra includes server products.
- Agents and Infra includes industry solutions.
- Agents and Infra includes enterprise and partner services.
✨ This summary was generated by AI from the outlets' reporting listed below. It is not independently verified and may contain errors — check the original sources. How BrevFeed works →
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How outlets covered it
Microsoft is changing its financial reporting structure to two segments and will begin disclosing quarterly revenue for its Azure cloud business. These changes reflect the company's evolving operations and the impact of AI on its business models.
Microsoft will begin reporting quarterly revenue for its Azure cloud business and is restructuring its operating segments from three to two. This change provides more detailed financial insight into Azure's performance, aligning Microsoft's reporting closer to competitors like Amazon Web Services and Google Cloud.