Microsoft Corp. reported strong financial results for the quarter ended December 31, 2025, driven by growth in cloud services, AI integration, and productivity tools. The company posted revenue of 81.3 billion, up 17 from the same period last year, and operating income of 38.3 billion, up 21. GAAP net income reached 38.5 billion, a 60 increase, while non-GAAP net income was 30.9 billion, up 23. Diluted earnings per share rose to 5.16 on a GAAP basis and 4.14 on a non-GAAP basis. Non-GAAP results exclude the impact from Microsoft's investments in OpenAI, which contributed a net gain of 7.6 billion this quarter.
The company's Microsoft Cloud segment posted revenue of 51.5 billion, a 26 increase, with commercial remaining performance obligations rising 110 to 625 billion. Within the segment, Azure and other cloud services grew 39, Microsoft 365 Commercial increased 17, Microsoft 365 Consumer rose 29, and Dynamics 365 grew 19. The Productivity and Business Processes segment generated 34.1 billion in revenue, up 16, while Intelligent Cloud revenue reached 32.9 billion, up 29. The More Personal Computing segment saw revenue decline 3 to 14.3 billion, with modest growth in Windows OEM and Devices 1 and declines in Xbox content and services -5. Search and news advertising revenue grew 10.
During the quarter, Microsoft returned 12.7 billion to shareholders through dividends and share repurchases, a 32 increase compared to the previous year. The company highlighted that AI adoption across its product suite, coupled with strong demand for cloud services and enterprise solutions, was a key driver of revenue growth. LinkedIn revenue also increased 11, reflecting growth in professional networking and advertising services.
