Microsoft shares rose 4% to 5% in after hours trading after the company reported fiscal first quarter Azure revenue grew 48% to $33.2B, topping the $32.3B analyst consensus, and projected constant currency Azure growth would accelerate to 49% to 50% in the second quarter. Total revenue increased 19% from a year earlier to $92.28B, beating estimates of $90.63B, with $10B, or nearly 11% of the total, coming from OpenAI alongside $7.2B in outstanding receivables from the AI startup. Adjusted earnings rose 18% to $4.89 a share against expectations of $4.73, while operating income climbed 21% to $45.92B and Microsoft Cloud revenue increased 30% to $63.9B.
First quarter capital expenditures, excluding finance leases, came in at $39.37B, below the $45.93B analyst estimate, while total capital spending including leases reached $45.2B, short of Microsoft’s own $50B projection. CFO Amy Hood trimmed calendar 2026 capital expenditure guidance to about $170B from roughly $175B because some third party GPU as a service capacity deliveries were delayed to the second half of fiscal 2027, pushing free cash flow to $18.6B, more than double the $8.54B estimate. Hood forecast second quarter revenue of $96B to $97.1B, ahead of the $95.62B consensus, with capital spending topping $50B before accelerating in the second half as delayed capacity comes online and CPU, memory, storage, and GPU costs rise.