Microsoft's AI business crossed a $37 billion annual revenue run rate in fiscal Q3 2026 (quarter ended March 31), up 123% year-over-year, as total revenue grew 18% to $82.9 billion and Azure cloud services grew 40%. The figure covers AI model builders running on Azure plus Microsoft's own AI tools — the most direct public disclosure of AI revenue at this scale by any cloud hyperscaler. Capital expenditures totaled $31.9 billion for the quarter (+49%), with the company forecasting $190 billion in full-year 2026 capex.