Microsoft Corp. on Wednesday reported revenue of $92.3 billion for the quarter ended Sept. 30, an increase of 19% from the corresponding period of the last fiscal year.
Operating income was $45.9 billion and increased 21%, or 22% in constant currency, a measure that excludes foreign currency rate fluctuations. Net income was $36.6 billion and increased 32% on a generally accepted accounting principles basis, according to the company.
Diluted earnings per share was $4.92 and increased 32% on that basis. On a non-GAAP basis excluding the impact from investments in OpenAI, net income was $36.4 billion and increased 18%, and diluted earnings per share was $4.89 and increased 18%.
The OpenAI investments increased net income by $207 million and diluted earnings per share by $0.03. A year earlier, they decreased net income by $3.1 billion and diluted earnings per share by $0.41, the company said.
Microsoft Cloud revenue was $63.9 billion and increased 30%, or 31% in constant currency. Azure revenue increased 48%. Commercial remaining performance obligation increased 73% to $677 billion.
Executive vice president and chief financial officer Amy Hood said the company delivered a strong start to the fiscal year and that results exceeded expectations across revenue, operating income, and earnings per share.
Revenue in Agents and Infra was $76.8 billion and increased 25%. Microsoft 365 commercial cloud revenue increased 17% on a reported basis and 18% on an adjusted basis, normalized for a 1-point benefit from in-period revenue recognition in the prior year.
Microsoft 365 consumer cloud revenue increased 17%. Industry solutions cloud revenue increased 10%. Search and advertising revenue excluding traffic acquisition costs increased 12%.
Revenue in Devices and Consumer was $15.5 billion and decreased 3%. XBOX content and services revenue decreased 2%. Windows OEM and Devices revenue decreased 22%.
The company returned $10.2 billion to shareholders in the form of dividends and share repurchases in the first quarter of fiscal year 2027.
“We are delivering greater capability, choice, control, and cost efficiency for customers across our entire stack,” said Satya Nadella, chairman and chief executive officer of Microsoft.
Microsoft said it would provide forward-looking guidance on its earnings conference call and webcast. The non-GAAP financial measures should not be considered a substitute for, or superior to, GAAP results, the company said. Certain prior period amounts were recast to reflect changes to segments announced in September 2026.