Microsoft

Microsoft Corporation is a global technology company operating across cloud computing, artificial intelligence, productivity software, enterprise applications, cybersecurity, software development, professional networking, gaming and personal computing. Founded in 1975, Microsoft grew from a PC software company built around MS-DOS, Windows and Office into a much broader platform business centered increasingly on Azure, Microsoft 365, developer tools, subscriptions and AI.

Last updated: August 2026

About Microsoft

Microsoft is one of the world's largest technology companies, serving consumers, developers, businesses, governments, schools and other organizations through a portfolio that spans software, cloud infrastructure, AI, security, business applications, gaming and digital services.

For much of its history, Microsoft was closely associated with Windows and Office. Those products remain important, but they no longer explain the company as a whole. Modern Microsoft combines several large technology ecosystems: Azure provides cloud infrastructure, Microsoft 365 supports workplace productivity, GitHub connects the company with developers, LinkedIn adds professional networking and recruitment, Xbox gives Microsoft a major gaming business, and Copilot increasingly brings AI into multiple products and workflows.

Microsoft is headquartered in Redmond, Washington. Satya Nadella currently serves as Chairman and Chief Executive Officer.

What Does Microsoft Do?

Microsoft operates several major technology businesses rather than relying on one flagship product.

Its activities can be grouped into several broad areas:

• Cloud computing: Microsoft Azure provides computing, storage, databases, networking, analytics, security and AI infrastructure.

• Productivity software: Microsoft 365 combines applications and services such as Word, Excel, PowerPoint, Outlook, Teams, OneDrive and SharePoint.

• Artificial intelligence: Microsoft integrates Copilot-branded AI experiences across productivity software, development tools, Windows and other products.

• Enterprise applications: Dynamics 365 and Power Platform support customer management, finance, workflow automation, low-code development and business operations.

• Operating systems and personal computing: Windows remains a major personal-computing platform and distribution environment for Microsoft applications and services.

• Developer tools: GitHub, Visual Studio and Azure give Microsoft a presence across software development, collaboration and cloud deployment.

• Professional networking: LinkedIn operates across professional identity, recruitment, advertising, sales products and premium subscriptions.

• Gaming: Xbox combines consoles, games, subscriptions, digital content and a large portfolio of gaming studios and intellectual property.

• Cybersecurity: Microsoft provides identity, endpoint, cloud and enterprise security products that integrate with its broader software and cloud portfolio.

• Devices and advertising: Surface hardware, Bing and related advertising businesses extend Microsoft into additional consumer and commercial markets.

These activities increasingly reinforce one another. A company can use Microsoft 365 for productivity, Microsoft's security products for identity and protection, Dynamics for business processes, Azure for cloud infrastructure and Copilot for AI-assisted workflows.

Microsoft Business Model

Microsoft's business model has changed substantially from the one that made the company famous during the personal-computer era.

Historically, Microsoft depended heavily on software licensing. Customers purchased Windows or Office licenses, while PC manufacturers paid to distribute Windows on new computers.

That model still exists, but subscriptions and usage-based services now play a much larger role.

Microsoft's modern business combines several models:

• recurring software subscriptions;

• consumption-based cloud services;

• enterprise software and support;

• traditional software licensing;

• advertising;

• professional-networking services;

• gaming subscriptions and content;

• hardware sales.

The broader system works because these businesses can connect.

A business using Microsoft 365 may also adopt Microsoft's security products, Azure infrastructure, Dynamics applications or Copilot. Developers can store code on GitHub, work with Microsoft development tools and deploy applications to Azure. Windows gives Microsoft a large personal-computing environment through which additional services can be distributed.

This creates a business model built not only around individual products, but around ongoing customer relationships and interconnected platforms.

From Packaged Software to Cloud and Subscriptions

The contrast between Microsoft's earlier and current business models is significant.

Microsoft did not abandon Windows or Office. It changed the role those products play within a much larger technology business.

How Does Microsoft Make Money?

Microsoft earns revenue through a diversified mix of subscriptions, cloud usage, software licensing, advertising, enterprise applications, gaming and hardware.

For financial reporting, Microsoft organizes its operations into three major segments:

• Productivity and Business Processes

• Intelligent Cloud

• More Personal Computing

A practical view of Microsoft's revenue model looks like this:

The importance of these streams varies by customer.

A consumer may interact with Microsoft through Windows, Microsoft 365 or Xbox. A large company may use Microsoft 365, Azure, cybersecurity products, databases, business applications and developer tools at the same time.

Microsoft Financial Performance

Microsoft generated $331.8 billion in revenue in fiscal year 2026, an increase of 18% from the previous year.

Operating income reached $155.2 billion, while GAAP net income reached approximately $133.7 billion.

Cloud infrastructure has become especially important to Microsoft's scale. The company disclosed that Azure surpassed $100 billion in annual revenue in FY2026 for the first time. Azure and other cloud services revenue increased 43% year over year during Microsoft's fiscal fourth quarter.

These figures illustrate how much Microsoft's economic center of gravity has shifted toward cloud infrastructure, enterprise software, subscriptions and AI-related services.

Microsoft's modern revenue model also carries substantial costs. Cloud computing and generative AI require large investments in data centers, networking, chips and computing capacity. The success of the model therefore depends not only on growing AI and cloud usage, but on turning those investments into durable customer demand.

Products and Services

Microsoft operates one of the broadest product portfolios in the technology industry. Its major platforms serve consumers, businesses, developers, governments and educational institutions.

Windows

Windows remains Microsoft's best-known operating system and one of the products that established the company's position in global personal computing.

Windows continues to connect Microsoft with PC manufacturers, enterprises and consumers while serving as a distribution environment for applications, security services and AI features.

Its strategic importance, however, now sits alongside much larger cloud and enterprise businesses.

Microsoft Azure

Microsoft Azure is Microsoft's cloud computing platform.

It provides computing infrastructure, storage, databases, networking, analytics, security, application hosting and AI services.

Azure is not a consumer application in the same sense as Word or Teams. It generally operates underneath applications and business systems, allowing companies and developers to run technology workloads without owning all of the underlying physical infrastructure themselves.

Azure has become one of Microsoft's most strategically important businesses and exceeded $100 billion in annual revenue during FY2026.

Microsoft 365

Microsoft 365 is Microsoft's productivity and collaboration ecosystem.

It includes services and applications such as:

• Word

• Excel

• PowerPoint

• Outlook

• Teams

• OneDrive

• SharePoint

Microsoft 365 is delivered primarily through subscriptions, allowing Microsoft to combine traditional productivity software with cloud storage, collaboration, security and AI capabilities.

Microsoft Copilot

Copilot is Microsoft's main AI brand across multiple products and workflows.

Copilot is not one single application with one fixed feature set. Microsoft uses the brand across experiences for workplace users, developers and consumers.

The capabilities available depend on the specific product and environment. Microsoft 365 Copilot, for example, is designed around workplace applications and organizational information, while GitHub Copilot focuses on software-development workflows.

This makes AI increasingly a layer across Microsoft's existing businesses rather than an isolated product category.

Dynamics 365 and Power Platform

Dynamics 365 provides cloud-based business applications covering areas such as sales, finance, customer management and operations.

Power Platform extends Microsoft's enterprise ecosystem with tools for low-code development, data analysis and workflow automation.

These products allow Microsoft to participate in business processes beyond traditional office productivity.

GitHub and Developer Tools

Microsoft owns GitHub, one of the world's major software-development collaboration platforms.

GitHub allows developers to host code, manage projects and collaborate. Microsoft also provides Visual Studio development tools and Azure infrastructure.

Together, these businesses give Microsoft a position across several stages of software creation—from writing and managing code to deploying applications in the cloud.

LinkedIn

Microsoft owns LinkedIn, the professional networking platform it acquired in 2016.

LinkedIn generates revenue through recruitment and talent services, advertising, sales products and premium subscriptions.

It also gives Microsoft a professional identity and employment platform that complements its workplace and enterprise businesses.

Xbox and Gaming

Microsoft's gaming operations are built around Xbox, gaming subscriptions, digital content and a large collection of studios and intellectual property.

The business expanded significantly through acquisitions including ZeniMax Media and Activision Blizzard.

Microsoft completed its acquisition of Activision Blizzard in October 2023, adding major console, PC and mobile gaming businesses to its portfolio.

Microsoft Security

Microsoft provides cybersecurity products covering areas such as identity, endpoint protection, cloud security, threat detection and security operations.

Security is particularly important to Microsoft's enterprise position because its products already operate across workplace applications, user identities, devices and cloud infrastructure.

Surface and Devices

Microsoft develops first-party PCs and tablets under the Surface brand.

Hardware is smaller than Microsoft's cloud and software businesses, but it allows the company to directly demonstrate the integration of Windows, Microsoft services and selected AI capabilities on its own devices.

Bing and Advertising

Microsoft operates Bing and related advertising products.

Advertising revenue also comes through LinkedIn and other digital properties, giving Microsoft additional income streams outside software subscriptions and cloud services.

Customers and Markets

Microsoft serves an unusually broad range of customers.

Consumers

Consumers use products such as:

• Windows;

• Microsoft 365;

• Xbox;

• Surface;

• OneDrive;

• Copilot;

• Bing.

For individuals, Microsoft competes across personal computing, gaming, productivity software, search and AI-assisted digital services.

Businesses and Enterprises

Business customers are central to Microsoft's model.

Organizations may buy:

• Microsoft 365;

• Azure;

• Dynamics 365;

• cybersecurity products;

• databases;

• developer tools;

• AI services;

• enterprise support.

Large organizations can use several Microsoft platforms simultaneously, making integration between products an important part of the company's enterprise strategy.

Developers

Developers interact with Microsoft through GitHub, Visual Studio, Azure and AI development services.

This gives Microsoft a relationship with software creators even when their applications are not designed primarily for Windows.

Governments, Schools and Public Sector Organizations

Microsoft also serves governments, educational institutions and other public-sector customers through cloud infrastructure, productivity software, cybersecurity services and collaboration tools.

Professionals, Recruiters and Advertisers

LinkedIn gives Microsoft access to a different market from its traditional software businesses.

Professionals use the platform for networking and career development, while recruiters, sales teams and advertisers pay for commercial services built around LinkedIn's professional network.

Microsoft operates globally, with customers and employees distributed across many countries. Its FY2026 filing reported approximately 223,000 employees worldwide, including about 121,000 in the United States and 102,000 internationally.

Competitors

Microsoft does not compete with one company across its entire business. Its competitors vary by market.

The important competitive issue is that Microsoft often competes across several categories at the same time.

A cloud rival may also compete in AI. A productivity competitor may also offer cloud storage and collaboration. A gaming competitor may compete through hardware, subscriptions and exclusive content.

This makes Microsoft's ability to integrate products across its ecosystem strategically important.

Company History

Microsoft's history shows how the company repeatedly changed the level of computing at which it competed.

Microsoft began as a supplier of software for early personal computers. MS-DOS and Windows placed it at the center of the PC market, while Office became a standard workplace productivity platform.

The most important modern turning point came after Satya Nadella became CEO in 2014. Microsoft became more willing to support competing platforms, prioritized Azure and subscription services, expanded its developer ecosystem and increasingly treated cloud infrastructure rather than Windows as the foundation of future growth.

The 2020s added another shift: AI moved from being primarily a research capability or isolated feature to becoming part of Microsoft's wider product architecture.

Leadership

Microsoft is led by Satya Nadella, who serves as Chairman and Chief Executive Officer.

Nadella became CEO in February 2014 after holding leadership roles across Microsoft's enterprise and cloud businesses.

His tenure has been closely associated with several changes in Microsoft's direction:

• stronger emphasis on Azure and cloud infrastructure;

• expansion of subscription-based software;

• greater support for competing platforms;

• acquisition of LinkedIn and GitHub;

• expansion in gaming;

• integration of AI across Microsoft's product portfolio.

Microsoft was founded by Bill Gates and Paul Allen in 1975. Their role is primarily historical in the context of the company's current leadership structure, so Microsoft's present strategic direction is more closely associated with Nadella and the company's current executive leadership.

Ownership, Subsidiaries and Corporate Structure

Microsoft Corporation is a publicly traded company, meaning it is owned collectively by its shareholders rather than by Bill Gates, Satya Nadella or a single parent organization.

The company operates through several major businesses and controlled platforms.

For financial reporting, Microsoft uses three primary operating segments:

• Productivity and Business Processes;

• Intelligent Cloud;

• More Personal Computing.

Its broader corporate structure also includes major acquired businesses such as:

• LinkedIn;

• GitHub;

• ZeniMax Media;

• Activision Blizzard.

These businesses do not all operate under the Microsoft name.

LinkedIn and GitHub, for example, remain recognizable standalone brands despite being owned by Microsoft. Ownership therefore does not necessarily mean a business is fully rebranded or presented to customers as a Microsoft product.

The same structure allows Microsoft to own businesses serving very different audiences while connecting them strategically to the company's cloud, software, developer and gaming ecosystems.

Microsoft Strategy

Microsoft's current strategy centers on expanding several interconnected platforms rather than relying on one product category.

Cloud Infrastructure

Azure is fundamental to Microsoft's long-term direction.

Cloud infrastructure allows Microsoft to provide computing, databases, analytics, security and AI services to organizations without requiring those customers to operate all underlying infrastructure themselves.

Azure's scale also makes it the infrastructure layer supporting many of Microsoft's AI ambitions.

Artificial Intelligence

Microsoft is integrating AI across existing businesses instead of treating it only as a standalone product.

Copilot experiences appear across productivity software, software development and other workflows. Azure provides infrastructure for companies building and running AI systems.

This strategy allows AI to support several Microsoft businesses at once.

Enterprise Integration

Microsoft has a strong incentive to deepen relationships with customers already using its products.

An organization using Microsoft 365 may also adopt Azure, Dynamics, Power Platform, cybersecurity products and Copilot.

The company therefore competes partly through the breadth and integration of its ecosystem.

Developer Platforms

GitHub, Visual Studio and Azure give Microsoft a position across software development.

This allows the company to serve developers regardless of whether their applications are built specifically for Windows.

Gaming and Content

Microsoft's acquisition strategy has expanded Xbox from a console platform into a larger gaming ecosystem spanning subscriptions, studios, digital content and intellectual property.

Microsoft Mission and Strategic Direction

Microsoft states its mission as:

“To empower every person and every organization on the planet to achieve more.”

On its main corporate About page, Microsoft prominently publishes this mission but does not separately label a one-sentence corporate vision statement.

Its strategic direction is therefore better understood through its products and investments: cloud infrastructure, AI, security, developer platforms, enterprise software and services designed to work across different devices and operating systems.

Key Challenges and Risks

Microsoft's scale creates advantages, but it also exposes the company to several material challenges.

AI and Cloud Infrastructure Costs

Cloud computing and AI require enormous capital investment.

Microsoft must continually spend on data centers, networking, chips and computing capacity to support growing demand. The strategic challenge is not simply building AI infrastructure, but generating enough long-term customer usage to justify those costs.

Competition Across Multiple Markets

Microsoft competes simultaneously in cloud infrastructure, productivity software, AI, enterprise applications, operating systems, gaming, cybersecurity and developer tools.

A competitor does not need to challenge Microsoft across the entire company to pressure an important business. Stronger alternatives in cloud, AI, productivity or gaming can affect individual parts of the ecosystem.

Regulatory and Antitrust Scrutiny

Microsoft's scale and history make competition regulation an ongoing strategic consideration.

The company operates large platforms, makes major acquisitions and participates in markets where software, cloud infrastructure, gaming and AI can have significant competitive effects.

Regulatory scrutiny can therefore influence acquisitions, product integration and business practices.

Cybersecurity and Trust

Microsoft products sit inside many organizations' core technology environments.

That makes security and reliability particularly important. Problems affecting identity, cloud infrastructure, productivity software or enterprise systems can have consequences for customers far beyond a typical consumer application.

Execution Across a Very Broad Portfolio

Microsoft operates many large businesses at once.

The breadth of the portfolio can create integration advantages, but it also increases execution complexity. Microsoft must manage consumer software, enterprise infrastructure, developer platforms, gaming studios, advertising businesses, professional networking and AI investment without allowing weaker execution in one area to undermine the wider ecosystem.

Integrating Major Acquisitions

LinkedIn, GitHub, ZeniMax and Activision Blizzard significantly expanded Microsoft's reach.

The long-term value of large acquisitions depends on more than ownership. Microsoft must retain talent, maintain product quality and find ways to create strategic value without damaging the independent brands and communities that made those businesses attractive in the first place.

Key Facts About Microsoft

• Microsoft has operated for more than 50 years. The company was founded in 1975 and celebrated its 50th anniversary in 2025.

• Azure has become a $100 billion-plus annual business. The milestone highlights how far Microsoft's center of gravity has moved from traditional PC software toward cloud infrastructure.

• Microsoft operates across both consumer and enterprise technology. Few large technology companies have major positions simultaneously in cloud infrastructure, productivity software, operating systems, professional networking, developer tools and gaming.

• Microsoft owns several major businesses that retain their own brands. LinkedIn and GitHub are prominent examples of Microsoft-owned platforms that continue to operate under separate identities.

• AI increasingly functions as a layer across Microsoft's portfolio. Copilot branding appears across workplace software, development tools and other products rather than being confined to one standalone application.

• Microsoft's modern business relies heavily on recurring relationships. Subscriptions and cloud consumption have become much more important than the packaged-software model associated with the company's earlier history.

• Windows remains important without defining the entire company. Microsoft's current business is substantially more diversified than its reputation as the company behind Windows might suggest.

• Microsoft employs approximately 223,000 people worldwide. Its FY2026 filing reported about 121,000 employees in the United States and 102,000 internationally.

Frequently Asked Questions

Who owns Microsoft?

Microsoft is a publicly traded company, so it is owned collectively by its shareholders rather than by Bill Gates, Satya Nadella or one parent organization.

Founders and executives may own Microsoft shares, but that is different from individually owning the company.

Who founded Microsoft?

Microsoft was founded by Bill Gates and Paul Allen in 1975 during the early development of the personal-computer industry.

What does Microsoft do?

Microsoft operates across cloud computing, AI, productivity software, enterprise applications, cybersecurity, developer platforms, operating systems, professional networking, gaming and devices.

Its largest platforms include Azure, Microsoft 365, Windows, GitHub, LinkedIn, Xbox and Copilot.

How does Microsoft make money?

Microsoft earns money through Microsoft 365 subscriptions, Azure cloud usage, enterprise software, Windows licensing, advertising, LinkedIn services, gaming content, subscriptions and hardware.

Its modern business increasingly depends on recurring subscriptions and usage-based cloud services.

What is Microsoft's biggest business?

There is no single answer unless the metric is defined.

Microsoft reports three major operating segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. Azure has become one of the company's most important growth engines and surpassed $100 billion in annual revenue in FY2026, but Azure itself is not reported as a standalone operating segment.

Does Microsoft own LinkedIn and GitHub?

Yes.

Microsoft completed its acquisition of LinkedIn in 2016 and GitHub in 2018. Both continue to operate under recognizable brands while forming part of Microsoft's wider business.

Is Microsoft mainly a software company?

Software remains fundamental to Microsoft, but describing it only as a software company is incomplete.

Microsoft also operates large cloud-infrastructure, AI, professional-networking, advertising, gaming and hardware businesses.

What is Microsoft's mission?

Microsoft states its mission as:

“To empower every person and every organization on the planet to achieve more.”

The company uses this mission across its corporate communications to describe its broad role in serving individuals and organizations through technology.

Resources:

• Microsoft Investor Relations — Fiscal Year 2026 Fourth Quarter and Full-Year Results

• Microsoft Corporation — FY2026 Form 10-K (SEC)

• Microsoft — About Microsoft and Corporate Mission

• Microsoft — Satya Nadella Leadership Profile

• Microsoft — Facts About Microsoft and Company History

• Microsoft Investor Relations — Acquisition History

• Microsoft — Official GitHub Acquisition Announcement

• Microsoft — Official Activision Blizzard Acquisition Completion Announcement