Microsoft reports record $92.3 billion revenue as it offers voluntary exit packages to 60,000 staff
Microsoft posted a 19% year-over-year revenue increase to $92.3 billion and announced voluntary exit offers affecting about 27% of its workforce.
Microsoft announced first-quarter revenue of $92.3 billion, up 19% from a year earlier, marking its tenth consecutive record quarter. The company said it will now split its financial reporting into two segments: the AI-focused Agents and Infra segment, which includes Azure, and the Devices and Consumer segment, which includes Xbox. The Agents and Infra segment generated $76.8 billion in revenue, driven by strong demand for Microsoft Cloud services, CFO Amy Hood said on the earnings call.
Around the same time, Microsoft extended voluntary exit offers to roughly 60,000 employees, about 27% of its workforce. The offer follows a previous buyout program for retirement-age staff that reduced headcount by about 2,600 people and was followed by a layoff of approximately 4,800 workers.
Capital expenditures rose to $45.2 billion for the quarter, with three-quarters of the spending directed toward CPUs and GPUs. Microsoft expects spending to exceed $50 billion in the next quarter. Free cash flow declined to $18.6 billion from $25.7 billion a year earlier, but remained positive, unlike rivals Google, Meta and Amazon, which have reported negative free cash flow in recent periods. Hood indicated that Microsoft expects free cash flow to stay positive through the fiscal year.
Analysts noted that the revenue growth and continued cash-flow positivity provide reassurance to investors amid broader concerns about AI-related spending across the technology sector.