During the earnings conference call for the fourth quarter of Microsoft's fiscal year 2025, company executives presented the performance, discussed non-GAAP financial metrics, and reminded investors to pay attention to risks and uncertainties. The conference also mentioned the impact of exchange rate fluctuations on performance, as well as how to assess the performance of the underlying business. Meanwhile, the conference emphasized that all growth comparisons are based on comparisons with the same period last year, and provided growth rates in constant currency.

Microsoft's cloud computing business hit a new high in the past fiscal year, with annual revenue exceeding $168 billion, a 23% year-on-year increase. Among them, Azure business performed particularly well, with annual revenue surpassing $75 billion, a 34% increase, and continued to lead in the field of AI infrastructure. Microsoft has expanded its data centers globally, now owning more than 400 data centers in 70 regions, making it the world's largest cloud service provider. In addition, Microsoft has made large-scale innovation in AI products and technology stack, including the launch of Microsoft Sovereign Cloud and progress in quantum computing. Furthermore, Microsoft Fabric, as a data and analytics platform for the AI era, achieved a 55% annual growth rate, serving over 25,000 customers and becoming the company's fastest growing database product. Azure AI Foundry helps enterprises design, customize, and manage large-scale AI applications and agents, serving 80% of the Fortune 500 companies and handling over 51 trillion AI model inference requests. Microsoft's Copilot series of applications has over 100 million monthly active users, demonstrating the widespread use of AI in daily work.

Microsoft has made significant updates to its 365 Copilot this quarter, integrating chat, search, note creation, and agent functions, significantly improving work efficiency and user adoption speed. Many large enterprises, including Barclays Bank, UBS Group, Adobe, KPMG, Pfizer, and Wells Fargo, have deployed Copilot on a large scale, with some companies purchasing over 25,000 seats. In addition, Copilot has made significant progress in specific fields such as development, healthcare, and security, for example, GitHub Copilot has reached 20 million users, Dragon Copilot in the medical field has recorded 13 million doctor-patient interactions, and AI agents in the security field have automated the handling of high load tasks. Additionally, Microsoft has integrated Copilot functionality into browsers and the Windows operating system, strengthening the practicality of AI in daily applications. In terms of security, Microsoft has introduced several new features to ensure the security of AI infrastructure and agents, including data lake integration, identity access management, application security, and data protection.

In the past year, Microsoft has achieved significant growth, with total revenue reaching $281 billion, a 15% year-on-year increase, thanks to its wide range of products and services. Among them, the number of LinkedIn members reached 1.2 billion, with significant growth in video uploads and comments; the gaming department also performed well, with monthly active users reaching 500 million, the successful release of games such as "Forza Horizon 5" and "Oblivion Remastered", as well as the continued strength of the "Call of Duty" series, driving the growth of the gaming business. Microsoft's cloud services revenue reached $46.7 billion, a 27% year-on-year increase, demonstrating the company's strong momentum in AI infrastructure and cloud services. In addition, the company mentioned its investments and prospects in the field of AI, showing a high level of confidence in future development.

Microsoft's revenue for the productivity and business processes department was $33.1 billion, a year-on-year growth of 16% and 14% respectively, exceeding expectations, primarily driven by strong performance of M365 commercial products and cloud services, as well as M365 consumer products and cloud services. M365 commercial cloud revenue also exceeded expectations, growing by 18% and 16%, boosted by two revenue recognition adjustments. Commercial trends remained relatively stable, with ARPU growth primarily driven by E5 and M365 Copilot. M365 commercial product revenue grew by 9% and 7%, benefiting from high transaction purchases of Office 2024. Consumer cloud revenue grew by 20%, primarily driven by ARPU growth and an 8% increase in subscription users. LinkedIn revenue grew by 9%, driven by all businesses, despite a soft recruitment market impacting talent solutions. Office 365 revenue grew by 23% and 21%, with core annual sales growth driving growth across all workloads. The Intelligent Cloud division's revenue was $29.9 billion, a year-on-year growth of 26% and 25% respectively, exceeding expectations, primarily driven by strong growth in Azure and online services business, as well as Azure and other cloud services.

The financial report of Microsoft shows significant growth in the areas of enterprise and partner services, personal computing, including strong performance in various business units such as enterprise support services, Windows, and Xbox content services. Although some areas, such as industry solutions and Windows OEM revenue, have seen a decline, overall growth momentum is good. In addition, the report also mentions the impact of the expansion of cloud computing and artificial intelligence infrastructure on the company's financial data, as well as outlook for future fiscal years, including expectations for capital expenditure, operating costs, and revenue growth.

In this conversation, the focus is on the company's recent outstanding performance and the outlook for future platform development strategies. The speaker expressed satisfaction with the company's performance and emphasized the importance of product and platform development, as well as mentioning long-term development plans and optimism for the future.

The conversation discussed how software companies can effectively profit from artificial intelligence technology, especially in terms of the differences in AI applications for different types of software (such as generic software and industry-specific software) and long-term profit margin considerations.

The conversation delved deep into the transformation from servers to cloud computing, and how this transformation has lowered the barriers to use, promoting efficient utilization of computing resources and intelligent development. Further discussions were had on the changes in infrastructure, data layers, application servers, particularly in the introduction of artificial intelligence and autonomous agents, such as the example of GitHub Copilot, demonstrating how AI technology can be embedded into software development and enterprise applications, leading to business model innovation and potential commercial opportunities.

The conversation discussed the recent growth of Azure cloud services, especially the accelerated migration activities of enterprises from on-premises deployment to Azure. Several key factors were mentioned, including enterprises like Nestle migrating SAP instances to Azure, the expansion of cloud-native applications, and the increasing demand for AI workflows, all of which are driving Azure's growth. At the same time, it was pointed out that this migration trend may still be in the mid-term stage and is sustainable.

In the discussion, the rapid progress of AI applications and platforms at the current stage was emphasized, as well as how their complexity exceeds expectations. It was pointed out that the past simple API call pattern has evolved into a more complex and stateful application pattern, which requires a rethink of the application stack. Particularly in the areas of storage and index building, improving the quality of complex engineering through preprocessing demonstrates the acceleration and maturation of AI application development. Additionally, the importance and technological advancements of products such as Azure Search Fabric and Cosmos DB in building complex applications were mentioned. Overall, this discussion reflects the rapid development of AI application and platform technologies, along with the associated technological challenges and learning curves.

The conversation discussed Copilot as the starting point of AI technology, and how to understand the central role of data in AI applications during customer interactions. It further explored the evolution from Copilot to data-driven agents, emphasizing the importance of UI in guiding and monitoring asynchronous work. Even when dealing with asynchronous tasks, operations and monitoring still need to be done through the user interface. In addition, it mentioned the widespread application of GitHub Copilot in code reviews, demonstrating how Copilot technology goes beyond simple request-response patterns and extends to more complex application scenarios.

In the discussion, Microsoft emphasized the close relationship between its capital expenditures (CapEx) and the growth of cloud services, especially Azure cloud services. Microsoft noted that although capital expenditures have accelerated in the short term, this is closely related to the company's large contract backlog ($368 billion), indicating a positive expectation for cloud service demand. In addition, Microsoft also mentioned the increase in infrastructure demands due to AI technology, as well as the focus on continued investment to meet the growing market demands, rather than overly focusing on the intersection of capital expenditures and revenue growth, emphasizing the importance of market share and business growth.

The discussion focused on how to optimize hardware performance through software skills, as well as the application of this optimization in the past cloud transformation and future faster transformation strategies. It mentioned maximizing efficiency through parallel processing rather than serial processing, and emphasized the key role of software in improving hardware performance.

During Microsoft's earnings conference call, the company discussed the application of AI technology in internal operations, as well as how to respond to market changes by enhancing product competitiveness and innovation. It emphasized the importance of delivering excellent products, increasing revenue, and continuing to invest efficiently to maintain and increase operating profit margins. At the same time, it pointed out that excellent talent and focusing on major market opportunities are crucial to achieving these goals.