By Louisa Clarence-Smith
Publication Date: 2026-01-28 23:01:00
Microsoft narrowly beat Wall Street’s quarterly sales expectations as companies developing and running artificial intelligence services turned to its Azure cloud computing business.
However, the slim margin by which Azure exceeded forecasts amplified investor doubts about the payoff from Microsoft’s huge AI spending against intense competition.
The shares fell more than 6 per cent in after-hours trading in New York.
Microsoft reported that revenue rose 17 per cent to $81.3 billion in the three months to the end of December, beating analysts’ consensus forecasts of $80.3 billion. Net income rose 60 per cent year-on-year to $38.5 billion. Sales from Azure grew 39 per cent in the second fiscal quarter from a year ago. Wall Street analysts had expected this to rise by about 38 per cent.
Investors are worried about whether hundreds of billions of dollars of investment on AI infrastructure will translate into profit growth.
This year, Microsoft, Amazon, Alphabet and Meta are expected…
