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Azure growth accelerates as Microsoft backlog jumps 84%
Azure growth rose to 43% and commercial remaining performance obligations climbed 84% to $678 billion, while guidance pointed to roughly 45% growth next quarter.
Microsoft shares were essentially flat for 2026 overall, ending Sept. 2 around where they started the year, but a record-setting post-earnings rally erased months of losses in a single session. MarketBeat Ratings attributes investor skepticism earlier in the year to AI-spending anxiety, concerns about whether artificial intelligence would disrupt software demand, and worries around Copilot adoption.
In Microsoft’s latest earnings report, Azure’s growth accelerated to 43%, up from 40% in the prior quarter. The company also guided to roughly 45% Azure growth for the current quarter, with the article noting that acceleration is a different signal than simple maturation.
The report highlighted a backlog jump as another key datapoint. Commercial remaining performance obligations (RPOs) rose 84% year-over-year to $678 billion, and Microsoft CFO Amy Hood said sequential growth came from customers outside the frontier AI labs, which MarketBeat Ratings says challenges the bearish view that cloud demand is narrowly concentrated.
Even after the rally, the piece notes Microsoft trades at roughly 26x forward earnings, below its five-year average forward earnings multiple, suggesting the market is still adjusting its valuation assumptions around Azure’s momentum.