Microsoft Corporation

Strong results / momentum in Cloud + AI (what’s good): - FY26 revenue > $331B (+18%); Microsoft Cloud > $214B (+27%); Azure > $100B (+41%). - Q4 revenue $90B (+18%), gross margin 67% (down YoY); operating income +18%; EPS $4.74 (+23%) (adjusted excluding OpenAI investment impact). - Commercial demand strong: Commercial bookings +18% (excluding OpenAI), Commercial RPO +84% to $678B, and RPO duration ~2.3 years with ~30% recognized in next 12 months (up 37% YoY).

AI infrastructure acceleration (what’s good + surprising): - 31 new data centers added this quarter; 88 added in the year across 5 continents. - Faster capacity bring-up: reduced dock-to-live for new GPUs ~50% in largest regions; added another 1 gigawatt of capacity this quarter; on track to roughly double capacity in 2 years. - Copilot workload throughput: 4x throughput since start of year. - Notable platform traction: 30M+ paid Microsoft 365 Copilot seats, with net seat adds more than doubling QoQ; Copilot conversations per user ~nearly doubled YoY; latency cut 25% QoQ; user satisfaction doubled over 3 quarters.

Productization of “agentic” stack + monetization shifts (what’s good + opportunity): - Microsoft emphasized building an end-to-end Foundry + IQ (context layer) + Agent 365 (governance/control plane) stack: - 100,000 Foundry customers, revenue more than doubled YoY; Foundry token annualized run rate increased 4x YoY (to ~1T). - Agent 365: ~40M agents registered across tens of thousands of companies (after ~2 months). - Model choice / multi-provider adoption: 11,000+ models catalog; 5x increase in customers building with models from multiple providers. - Business model evolution (consumption + usage-based): - Usage-based billing added for Cowork and Copilot-related changes; Microsoft highlighted Copilot revenue accelerated >60% QoQ after June pricing model change aligning with usage/value. - Dynamics 365 exposed 650k+ MCP actions and moving from seats toward seats + consumption (customer service usage-based credits up 4x QoQ).