Microsoft forced to up AI spending by $25 billion to cover hardware price rises — says it 'remains confident in the return on these investments'

• Azure revenue is up 29%, but next quarter's growth could rise 40%
• Two-thirds of last quarter's capex was dedicated to CPUs, GPUs
• Microsoft 365 Copilot now has over 20 million paying customers

In its latest quarterly results, Microsoft has confirmed an 18% rise in revenue to $82.9 billion for the most recent three months, with Microsoft Cloud revenue up around 29% year-over-year to $54.5 billion and Azure growth standing at around 40%.

However despite heavy spend by customers in its products and services, the company hasn't been immune from rising prices and global chip shortages, CFO Amy Hood explained.

With its AI business now standing at around $37 billion in annual revenue run rate (up 123% year-over-year), Microsoft is being forced to spend big on AI and data center technology.

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