Microsoft Q4: Azure tops $100B for the first time, Copilot hits 30M paid seats

Microsoft's fiscal-year close was a decisive AI-cloud print: annual revenue of $331B (+18%), Microsoft Cloud at $214B (+27%), and Azure crossing $100B for the first time at +41%. Microsoft 365 Copilot passed 30 million paid seats — with net seat additions doubling quarter-over-quarter — and commercial RPO surged 84% to $678B, signaling a deep contracted backlog of AI demand.

On the earnings call and in a LinkedIn post, Nadella emphasized a strategic shift: Microsoft is building a 'new model system' where the harness, context, memory and action space are decoupled from any single model family, improving the cost-to-outcome curve and giving Microsoft business continuity independent of OpenAI. He said in-house MAI models already power Bing Image Creator and Dynamics 365 at 84–89% lower GPU cost than comparable OpenAI models. Nadella even demoed building a 'ROIC Intelligence App' from a Morgan Stanley PDF using forthcoming Copilot code tooling with a single prompt.

Competitively, the quarter answers investor worries about AI capex by showing the spend converting to revenue, and it lands the same day AWS posted 37% growth — confirming both hyperscalers are compounding on AI. The MAI cost-reduction story doubles as leverage in Microsoft's evolving relationship with OpenAI. What to watch: how far Microsoft pushes its own models into first-party products, and whether the multi-model 'harness' strategy erodes OpenAI's position inside Microsoft's stack.