Microsoft posts $92.3 billion quarterly revenue amid voluntary employee buyouts

Microsoft reported $92.3 billion in total revenue for the September quarter in a securities filing issued on Wednesday, Oct. 28, 2026, marking the company’s tenth consecutive record-breaking quarter. The company recorded more than $36.6 billion in profit, a 32 percent increase from the previous year, while offering voluntary buyouts to about 60,000 workers, roughly a quarter of its workforce. Analysts surveyed by FactSet had expected approximately $90.6 billion in revenue and $35.1 billion in profit for the period. Microsoft shares rose by almost 2.9 percent in after-hours trading in New York on Wednesday.

Azure cloud computing sales rose 48 percent to $33.2 billion in the September quarter, and Microsoft Cloud revenue increased 30 percent, lifting earnings for the three months to the end of September, as Microsoft split its financial reporting into two segments: Agents and Infra, which includes Azure, Excel, Teams, and Copilot, and Devices and Consumer, which covers Xbox. The Agents and Infra segment generated $76.8 billion in revenue, driven by strong demand across Microsoft Cloud, according to Chief Financial Officer Amy Hood. In contrast, the Devices and Consumer segment, which includes Xbox, saw sales drop 3 percent to $15.5 billion because of weaker demand for Windows and Xbox products.

This is Microsoft’s second voluntary buyout offer in 2026, following an April programme that gave about seven percent of its US staff the option to retire early, involving roughly 9,000 workers. More than 30 percent of employees eligible for the April retirement programme had accepted the offer by July. Microsoft had 223,000 full-time employees globally as of June 30, 2026, down from 228,000 at the end of 2025, and currently employs more than 220,000 people around the world.

The current buyout program covers eligible employees in the United States, Canada, India, and the United Kingdom at experience level 70 or below, according to a staff memo. Workers in divisions including AI experiences, Copilot, finance, human resources, Xbox, and Windows plus Devices could qualify for the buyouts, while Microsoft excludes marketing, commercial business, and security teams. Eligible employees must decide whether to accept the buyout in early December, and Microsoft expects participating staff to leave on December 31. Some marketing, sales, and engineering teams have decided not to join the buyout program, and Microsoft has not set a target for how many employees it expects to leave, while Amy Coleman, Microsoft’s Chief People Officer, said in a staff memo, “This offer gives eligible employees who may be considering a future outside the company a new choice.”

Microsoft is spending heavily on artificial intelligence investments, with $45.2 billion in capital expenditures during the quarter, an increase of about 30 percent from the prior year, and roughly three-quarters of that spending went to CPUs (central processing units) and GPUs (graphics processing units) according to Amy Hood, who expects next quarter’s spending to breach $50 billion. Microsoft forecast about $170 billion in capital expenditures for the calendar year, while another report cited a $175 billion forecast for 2026. The company announced a Surface Ultra laptop running on Nvidia artificial intelligence chips that will cost more than $2,500, part of a broader push for on-device AI hardware. Despite this heavy spending, Microsoft’s free cash flow was $18.6 billion, down 28 percent from the prior year and below the previous quarter’s $19.6 billion, but remains positive while Google, Meta, and Amazon have reported negative free cash flow, according to Amy Hood, and the company added 24 data centers across five continents in the latest quarter due to strong demand, according to Chief Executive Officer Satya Nadella.

Microsoft expects revenue of up to $97.1 billion next quarter and plans to stay cash flow positive through the 2027 fiscal year. Big tech companies including Amazon, Meta, and Alphabet are expected to spend more than $700 billion in 2026 on AI chips and infrastructure, and Alphabet shares fell 9.75 percent after reporting a 25 percent drop in quarterly net profit, contrasting with Microsoft’s stronger earnings. Satya Nadella said in a statement, “We are delivering greater capability, choice, control, and cost-efficiency for customers across our entire stack.” Satya Nadella also said AI development has helped grow adoption of the technology and has delivered “real-world impact across every industry.”