Microsoft will begin disclosing Azure revenue as a standalone figure in its quarterly earnings starting with the first fiscal quarter of 2027, marking the first such structural change since 2015. The software giant is consolidating its three existing reporting segments into two new divisions: Agents and Infra, which combines Azure and server products with Microsoft 365 enterprise software, and Devices and Consumer, covering Windows, Xbox, search, and LinkedIn advertising.
The move aims to provide greater transparency by shifting from percentage-based growth metrics to absolute revenue figures for Azure, allowing direct comparison with cloud rivals such as Amazon Web Services and Google Cloud. Azure generated $29.4 billion in its most recent quarter and surpassed $100 billion in annual sales for the fiscal year ended June 2026, up from $75 billion the prior year. The cloud unit now accounts for approximately 30% of Microsoft's total revenue.
The restructuring follows a period of rapid expansion in Microsoft's cloud infrastructure, particularly in artificial intelligence services, where the company maintains a close commercial relationship with OpenAI. The change aligns with investor demands for clearer visibility into high-growth segments amid intensifying competition in AI-driven data center investments. Microsoft's shares rose 0.4% in after-hours trading following the announcement.
Amazon Web Services reported calendar-year sales of $128.7 billion in 2025, underscoring the scale of Microsoft's challenge in maintaining its market position. The new reporting framework is scheduled to take effect with Microsoft's first-quarter fiscal results, reflecting the company's broader strategic focus on transparency and comparability in its financial disclosures.
