Microsoft Azure demand exceeds capacity, with 90% of cloud revenue coming from non-frontline AI model clients.

Huo Xing Finance reports that on July 30, Microsoft stated during its earnings call that demand for Azure continues to exceed current capacity, and newly deployed AI infrastructure capacity achieves economic returns within the same quarter of deployment. The company expects free cash flow to return to positive growth in fiscal year 2027 as capital expenditure growth slows. Additionally, Microsoft CFO Amy Hood revealed that the company’s Cloud revenue reached $214.4 billion in fiscal year 2026, with Azure’s annual revenue surpassing $100 billion for the first time. Notably, nearly 90% of Cloud revenue comes from customers outside leading large model companies such as OpenAI and Anthropic, indicating that enterprise-grade AI demand has broadly expanded across diverse industries rather than being primarily reliant on top AI model developers. As of the time of this report, Microsoft’s stock rose 8.83% in after-hours trading.