CEO Satya Nadella pointed to Unilever, Rolls-Royce and Austrian lender Raiffeisen Bank International on Microsoft’s fiscal first-quarter earnings call Wednesday (Oct. 28), a quarter that beat expectations on revenue, operating income and earnings per share. He said they show companies applying AI to operational problems rather than isolated productivity tasks.
Unilever is automating order intake and trade promotion disputes. Rolls-Royce is using AI to manage maintenance planning, inventory and supply chains for jet engines with about 30,000 parts. Raiffeisen has deployed AI across more than 20 business processes, including credit-related workflows.
Nadella said customers now focus on whether AI systems deliver reliable results, manage costs and operate securely.
“The shiny object stuff is waning,” Nadella said.
Copilot Usage Grows as Microsoft Adds Usage Billing
Microsoft reported that daily Copilot users rose nearly 50% from the prior quarter and more than 5x from a year ago. Automated tasks nearly doubled since July. Customers with more than 50,000 Copilot seats rose more than 8x from a year ago.
We’d love to be your preferred source for news.
Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!
Volkswagen recently announced plans to deploy Copilot to more than 330,000 employees.
Microsoft is also changing how it charges. It now adds consumption-based billing for agents that handle more complex tasks, on top of per-user subscriptions. The number of Copilot customers consuming credits through usage-based billing grew more than 75% in the quarter.
Nadella said IT departments typically fund subscriptions that provide everyday AI. Individual business units can pay for agents that do higher-value work.
CFO Amy Hood said consumption pricing outside software development will likely move more slowly. She said it requires changes in sales practices and customer education.
On the consumer side, Microsoft 365 consumer cloud revenue rose 17%. Growth slowed from the prior quarter as Microsoft began lapping an earlier price increase.
What Else Stood Out
- Microsoft Execution Containers now govern agents on Windows. Nadella said OpenAI Codex, Anthropic Claude Code and Meta Muse are adopting them, and Meta is starting to deploy them across its enterprise.
- Agent 365 lists more than 50 million agents in its registry, up more than 30% from the prior quarter. Customers have used Microsoft Purview to audit more than 7.6 billion agent activities.
- Agents now open more than a third of all pull requests on GitHub. Agent-generated pull requests rose 6x in six months.
Revenue for the quarter was $92.3 billion, up 19%. Microsoft Cloud revenue reached $63.9 billion, up 30%. Azure revenue rose 48%.
For all PYMNTS AI coverage, subscribe to the daily AI Newsletter.
Add as Preferred Source
