Microsoft reports Q2 2026 revenue of $90 billion, up 18% YoY, driven by cloud AI services and enterprise adoption of Copilot.

Microsoft reported Q2 2026 revenue of $90.0 billion, increasing 18% year-over-year (17% in constant currency) and exceeding analyst expectations of $87.6 billion. Operating income reached $40.6 billion, also up 18% and ahead of the $39.1 billion estimate. Net income totaled $35.8 billion on a GAAP basis—a 31% increase—while non-GAAP net income was $35.3 billion, up 22%.

Diluted earnings per share came in at $4.81 on a GAAP basis (up 32%) and $4.74 on a non-GAAP basis (up 23%), beating the consensus estimate of $4.22.

Azure cloud revenue accelerated 43% year-over-year, surpassing the 40% expectation and crossing $100 billion in quarterly revenue for the first time. Commercial restricted perpetual offerings (RPO) rose 84% year-over-year to $678 billion, reflecting strong customer commitments.

Capital expenditure including leases totaled $41 billion, coming in below the $42.05 billion estimate. Standalone capital expenditure was $35.80 billion, marginally above the $35.22 billion expectation.

Microsoft 365 Consumer Cloud revenue grew 24%, while the Microsoft 365 Copilot offering reached over 30 million paid seats. The company also realized a $3.2 billion gain on its investment in Anthropic during the quarter.