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1Repair Windows errors before they cause bigger problems2Scan for outdated or missing drivers - takes under a minute3Clear out junk files and repair common Windows errorsMicrosoft makes money from cloud computing, business and consumer software subscriptions, Windows licensing, gaming, LinkedIn, advertising, devices, and business services. Its latest full-year results reviewed here show $331.8 billion in revenue for fiscal 2026, the year ended June 30, 2026. The latest detailed annual breakdown by product and service is for fiscal 2025, so those category figures are labeled separately below.
How much revenue does Microsoft make?
Microsoft reported $331.8 billion in revenue and $155.2 billion in operating income for FY2026, up 18% and 21%, respectively, from FY2025, according to its FY2026 Q4 earnings release. Revenue is the money the company earns before operating costs and other expenses; operating income is what remains after operating expenses, but before interest and taxes.
Microsoft’s FY2025 annual report gives the most recent detailed annual product-and-service breakdown available in the sources reviewed. The figures below are for the fiscal year ended June 30, 2025, in US dollars. They are revenue categories, not Microsoft’s three reportable operating segments.
| FY2025 product or service category | Revenue | How it earns money |
|---|---|---|
| Server products and cloud services | $98.435 billion | Cloud usage and related server products and services, including Azure and other cloud offerings. |
| Microsoft 365 Commercial products and cloud services | $87.767 billion | Commercial software and cloud services, including subscriptions and related products. |
| Gaming | $23.455 billion | Xbox hardware, games, in-game content, subscriptions, cloud gaming, advertising, and other services. |
| $17.812 billion | Talent, marketing, premium subscription, and sales solutions. | |
| Windows and Devices | $17.314 billion | Windows licensing and devices such as Surface and PC accessories; the reported figure combines them. |
| Search and news advertising | $13.878 billion | Advertising across Bing and Copilot, Microsoft News, Microsoft Edge, and third-party affiliates. |
| Dynamics products and cloud services | $7.827 billion | Business applications, including Dynamics 365 offerings for ERP, CRM, Power Apps, and Power Automate. |
| Enterprise and partner services | $7.760 billion | Services sold to enterprise customers and partners. |
| Microsoft 365 Consumer products and cloud services | $7.404 billion | Consumer productivity products and cloud services. |
| Total revenue | $281.724 billion | Microsoft’s total FY2025 revenue. |
Microsoft also reported $168.9 billion in FY2025 Microsoft Cloud revenue. That is a cross-business measure that includes Microsoft 365 Commercial cloud, Azure and other cloud services, commercial LinkedIn, and Dynamics 365. It overlaps with the categories above and is not an additional revenue stream to add to them.
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How do Microsoft’s reporting segments fit together?
Microsoft reports three operating segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. Each bundles products and services; they are not a one-to-one map of familiar brands such as Office, Azure, and Xbox.
- Productivity and Business Processes includes Microsoft 365 commercial and consumer offerings, LinkedIn, and Dynamics.
- Intelligent Cloud includes server products and cloud services such as Azure, plus enterprise services.
- More Personal Computing includes Windows and Devices, gaming, and search and news advertising.
Because Microsoft Cloud spans portions of more than one segment, it is a management measure, not a fourth reportable segment. The FY2025 annual report’s product categories and the Microsoft Cloud figure describe different views of overlapping business activity.
How does Azure make money?
Azure earns revenue when customers use Microsoft’s cloud and AI services, alongside related cloud offerings. This is largely a consumption-and-capacity business: customers pay for services they use, while demand and the capacity available to serve it can affect growth over time. Microsoft’s Azure and other cloud services measure also includes GitHub cloud services, Nuance Healthcare cloud services, virtual desktop offerings, and other cloud services.
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In Q4 FY2026, Azure and other cloud services revenue grew 43% year over year. On Microsoft’s FY2026 Q4 earnings call, management said demand exceeded available capacity and newly added capacity was quickly monetized. The call also said cloud gross margin was affected by a sales mix shift toward Azure and investment in AI infrastructure. These quarter-specific comments explain why strong cloud growth does not by itself establish a fixed margin or future growth rate.
Does Microsoft make money from Office subscriptions?
Yes. Microsoft earns from commercial and consumer Microsoft 365 products and cloud services. Commercial customers pay for subscriptions and related products; consumer customers pay for consumer offerings. Management has described commercial growth as coming from paid seats and revenue per user, with premium offerings and Copilot among factors that can contribute to revenue per user.
In Q4 FY2026, Microsoft 365 Commercial cloud revenue grew 14% year over year on a reported basis, or 16% after adjusting for a prior-year revenue-recognition comparison. Microsoft 365 Consumer cloud revenue grew 24% in the quarter. These are quarterly cloud-growth rates, not annual revenue totals or growth rates for every Microsoft 365 product.
How does Microsoft earn money from Windows and Surface?
Much of Windows licensing revenue comes through PC manufacturers, or OEMs, that buy Windows licenses for preinstallation on computers. Microsoft also sells its own hardware: its Devices business includes Surface PCs and PC accessories.
The FY2025 annual-report category is called “Windows and Devices” and totaled $17.314 billion. It combines Windows and device revenue, so it should not be read as Windows licensing revenue alone. The category is distinct from a direct-to-consumer subscription model: OEM licensing is tied to PC sales and preinstallation, while Surface revenue comes from hardware purchases.
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Scan for outdated or missing drivers - takes under a minuteDriver Scan →Repair Windows errors before they cause bigger problemsFix Now →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →What does Microsoft’s gaming revenue include?
Gaming is broader than Xbox console sales. Microsoft earns from hardware, first- and third-party games, in-game content, subscriptions such as Game Pass, cloud gaming, advertising, and other services. Game Pass is a subscription with a curated library of first- and third-party titles.
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Gaming generated $23.455 billion in FY2025. Separately, Xbox content and services revenue declined 10% year over year in Q4 FY2026; that quarter’s result is not a full-year gaming figure and does not describe hardware revenue.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How do LinkedIn, advertising, Dynamics, and services contribute?
LinkedIn generated $17.812 billion in FY2025. Its revenue streams include Talent Solutions, Marketing Solutions, Premium Subscriptions, and Sales Solutions. LinkedIn growth was 12% year over year in Q4 FY2026.
Search and news advertising
Microsoft sells search and news ads across Bing and Copilot, Microsoft News, Microsoft Edge, and third-party affiliates. Search and news advertising generated $13.878 billion in FY2025. In Q4 FY2026, search advertising revenue excluding traffic acquisition costs increased 10% year over year.
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Dynamics and enterprise services
Dynamics products and cloud services generated $7.827 billion in FY2025, while enterprise and partner services generated $7.760 billion. Dynamics 365 revenue grew 13% year over year in Q4 FY2026. Dynamics 365 is also included in Microsoft’s Microsoft Cloud definition, so its product category and the cloud subtotal should not be counted as separate, additive sales.
What changed most recently?
The following figures are from Q4 FY2026, the quarter ended June 30, 2026, and are not annual category totals. Microsoft reported segment revenue and selected year-over-year growth as follows:
| Measure | Q4 FY2026 result |
|---|---|
| Productivity and Business Processes segment revenue | $37.8 billion |
| Intelligent Cloud segment revenue | $39.3 billion |
| More Personal Computing segment revenue | $12.9 billion |
| Azure and other cloud services growth | 43% |
| Microsoft 365 Commercial cloud growth | 14% reported; 16% adjusted for a prior-year revenue-recognition comparison |
| Microsoft 365 Consumer cloud growth | 24% |
| LinkedIn growth | 12% |
| Dynamics 365 growth | 13% |
| Windows OEM and Devices revenue | Down 7% |
| Xbox content and services revenue | Down 10% |
| Search advertising revenue, excluding traffic acquisition costs | Up 10% |
The figures illustrate that Microsoft does not depend on a single product: cloud and commercial software were growing quickly in that quarter, while Windows OEM and Devices and Xbox content and services declined. The annual report remains the appropriate source for comparing full-year product categories; the Q4 measures above capture one quarter’s direction.
