Microsoft Cloud revenue tops $63B as Copilot and Foundry growth accelerates

Copilot unified, with Copilot Fusion for GitHub

Nadella described a "fast start to our fiscal year" and said Microsoft is building "the new tech stack for the agentic wave." The first highlight was what he called the company's biggest update to Copilot to date, which brings Chat, Cowork, Autopilot and Code together in one unified experience.

According to Nadella, Copilot daily users grew nearly 50% quarter over quarter and more than 5X year over year. User satisfaction improved nearly 20% quarter over quarter to what he called another all-time high. The number of customers with more than 50K Copilot seats rose 8X year over year.

He also cited momentum for GitHub Copilot, including Copilot Fusion, announced the same morning. Nadella said it delivers frontier level quality at up to 77% lower cost. He framed the next frontier as "maximizing intelligence per task while continuously optimizing for cost and performance."

Microsoft is also extending its vision of Copilot as the "new OS for work" by bringing the business logic and capabilities of D365 directly into Copilot. Nadella said this helps every organization stand up its own "infinite SaaS factory."

Foundry, Fabric and Microsoft IQ

The second highlight was the common platform beneath Microsoft's first-party experiences, starting with Foundry. Nadella said Foundry is becoming an increasingly important growth driver, with these figures:

• Foundry revenue more than tripled year over year.
• The number of customers building with multiple models grew 5X year over year.
• Revenue from open source models increased 10X year over year.

Microsoft is bringing Foundry and Fabric closer together so customers can build agents next to their data. With Microsoft IQ, the enterprise context underneath Microsoft 365, Foundry and Fabric is made available to agentic workloads. Nadella said nearly 60K customers are accessing context across Microsoft IQ, up 25% quarter over quarter.

Securing agents and the infrastructure behind them

On governance, Nadella said over 50M agents are now in A365, up 30% quarter over quarter. Microsoft is combining Windows and Agent 365 so agents can work within secure boundaries on the device using MXC. He named OpenAI Codex, Anthropic Claude Code and Meta Muse as agents adopting it.

With Perception, Microsoft is "separating intelligence from authority," enforcing identity, permissions, monitoring and containment outside the model itself. Nadella said the company is encouraged by feedback from preview customers.

On infrastructure, he described a fungible fleet that lets Microsoft dynamically allocate capacity to the highest value opportunities across compute, data, Foundry and Copilot. He said capacity is coming online faster and the company is getting more from existing infrastructure. Azure growth was broad-based across enterprise and SMB, spanning core cloud services and AI infrastructure.

What it means

The figures are Microsoft's own, shared by its CEO, and the post gives no further breakdown of revenue or the base for the growth rates. The emphasis is clear, though: Microsoft is positioning cost and performance per task as the metric that will matter to companies, and is tying Copilot, Foundry, Fabric and agent security into one stack. Nadella closed by saying he has "never been more confident in the opportunity ahead of us."

Replies under the post were mixed. Some commenters discussed cost per task and affordability for smaller businesses, while many others raised concerns about layoffs, which the post itself does not address.