Microsoft
Microsoft Corporation is an American multinational technology company founded by [[Bill Gates]] and Paul Allen on April 4, 1975.[^c1] Over five decades, the company evolved from a developer of personal computer software into one of the world's most valuable technology enterprises. Microsoft established the [[Windows]] operating system and Office productivity suite as industry standards, expanded into gaming with [[Xbox]], and transformed its business model under CEO [[Satya Nadella]] from a software-licensing model to cloud-based subscriptions anchored by [[Azure]].[^c2]
In its fiscal third quarter ended March 31, 2026, Microsoft reported revenue of $82.9 billion, up 18 percent year-over-year, with Microsoft Cloud revenue of $54.5 billion.[^c3] Azure grew 40 percent, and the company's AI business reached a $37 billion annual revenue run rate, up 123 percent year-over-year.[^c13] By mid-2026, nearly 90 percent of the Fortune 500 were running agents built via Copilot Studio, and over 300 customers were on track to process more than one trillion tokens on Microsoft Foundry for the fiscal year.[^c24] Wells Fargo raised Microsoft's price target to $650 in June 2026, citing the company's homegrown AI push and capacity investments ahead of Build 2026.[^c14] In fiscal year 2025, total annual revenue was $281.7 billion. In 2026, Microsoft introduced the Maia 200 AI accelerator. In 2025, the company matched 100 percent of its annual electricity consumption with renewable energy.[^c18]
At Build 2026 in June, Microsoft launched seven in-house MAI models, introduced the [[N1X chip|Nvidia RTX Spark]] partnership with new Surface hardware delivering 1 petaflop of AI compute, unveiled the Majorana 2 quantum processor with a 2029 scalability target, and announced Project Solara. The company launched [[Scout]], its first enterprise "Autopilot" agent built on [[OpenClaw]], and introduced [[Microsoft IQ]], a unified enterprise intelligence layer connecting AI agents to organizational context. [[Microsoft 365 Copilot]] expanded with the general availability of Copilot Cowork, a usage-based billing model for autonomous agentic tasks — the first change to Microsoft's Office pricing structure in two decades.[^c29][^c19] In partnership with EY, Microsoft announced a joint $1 billion+ initiative to scale enterprise AI deployment.[^c11] KPMG committed to deploying Microsoft 365 Copilot across more than 276,000 professionals, and Atos Group deployed it to 56,000 employees.[^c27]
In a major organizational restructuring in June 2026, Nadella dissolved Microsoft's traditional senior leadership team, replacing it with a five-member core group and a 35-strong engineering unit as the company prepared for the "agentic era" of superintelligence.[^c38] Yusuf Mehdi, a 35-year veteran, announced his planned departure, remaining through fiscal 2027 to oversee the "One Copilot" vision.[^c39]
In April 2026, Microsoft and [[OpenAI]] restructured their partnership, ending Azure's exclusive role as OpenAI's cloud provider.[^c5] The partnership generated roughly $30 billion in revenue between 2023 and 2025, and the restructured deal included $250 billion in Azure consumption commitments from OpenAI through 2032.[^c6][^c33] Microsoft also secured a $9.69 billion contract to supply Windows, Microsoft 365, and on-premises Azure tools to U.S. defense and intelligence agencies through Dell as the central supplier.[^c10] In March 2026, the company launched [[Copilot Health]], expanding its AI platform into consumer healthcare.[^c9] Microsoft announced plans for a Copilot super app combining chat, coding, and a new Autopilot function, to be released in summer 2026.[^c25]
Microsoft has built a substantial business selling AI models to Chinese companies despite US-China tensions, with ByteDance on track to spend over $1 billion annually on Microsoft AI and cloud services.[^c31] Executive vice president Jay Parikh stated that the company is undertaking "an entirely top to bottom systems overhaul" to support AI agents.
The company faced significant regulatory headwinds in mid-2026. The European Commission proposed the Cloud and AI Development Act, which would impose strict sovereignty requirements on cloud services for strategic state tenders.[^c15] The Commission also issued preliminary findings that Azure should be designated as a gatekeeper under the Digital Markets Act, marking the first such designation for a cloud service.[^c34] EU competition chief Margrethe Vestager opened a fresh antitrust investigation into the Microsoft-OpenAI partnership's exclusivity clauses.[^c16] In the United Kingdom, the Competition and Markets Authority launched a Strategic Market Status investigation into Microsoft's enterprise software ecosystem in May 2026, with a final decision expected by February 2027.[^c17] In the United States, the Federal Trade Commission accelerated its antitrust probe into Microsoft's cloud, AI, and software bundling practices, issuing civil investigative demands to competitors.[^c35]
In February 2026, [[Asha Sharma]] was appointed Executive Vice President and CEO of Microsoft Gaming, succeeding Phil Spencer.[^c23] In April 2026, Sharma announced the rebranding of the gaming division from Microsoft Gaming back to Xbox, reversing the 2022 branding change.[^c36] In June 2026, Sharma and chief content officer Matt Booty published a "100-day reset" restructuring acknowledging that the Xbox division was operating at a 3 percent profit margin with over $20 billion in cumulative spending over five years. Microsoft CEO Satya Nadella stated that the company would no longer provide unlimited financial support to Xbox.[^c32] Microsoft was reported to be considering options for Xbox including a potential spinoff or restructuring as a wholly owned subsidiary.[^c26] Forza Horizon 6 sold nearly 5 million copies in its early-access week, generating over $325 million in revenue and achieving Metacritic and OpenCritic scores above 90 — the strongest early-access launch in the franchise's 14-year history.[^c37]
OpenAI, in which Microsoft holds a 27 percent stake, removed the word "safely" from its mission statement during its for-profit restructuring and replaced its 2018 charter with a new five-point principles document in April 2026 that de-emphasised AGI and dropped the pledge to step aside for safety-conscious competitors.[^c21] Windows 11 reached 1 billion active devices by January 2026, driven by the Windows 10 end-of-support deadline.[^c22]
The company also maintains a major presence in professional networking through [[LinkedIn]], in gaming through Xbox and its [[Activision Blizzard]] subsidiary, and in enterprise software through the Microsoft 365 suite. In May 2026, Microsoft and NVIDIA jointly teased a "new era of PC," confirming a partnership on the RTX Spark Arm-based processor for Windows PCs. The company has faced mounting regulatory scrutiny in the United States, the United Kingdom, and Europe over its cloud computing and AI market positions, alongside investor concerns about the scale of its capital expenditure on AI infrastructure. Its sustainability efforts have been complicated by rising energy demands from AI data centers, and in mid-2026 Microsoft signaled it may delay its clean energy targets.[^c7] The company also undertook significant workforce reductions in 2026, affecting approximately 10,000 employees through layoffs and voluntary buyouts.[^c8]