Microsoft aims to cut AI costs and broaden ecosystem as global demand surges

Satya Nadella’s annual communication emphasized that the rise of "Super Intelligence" is changing every company's inputs and outputs, making the marginal cost of AI inference a critical factor. Microsoft plans to reduce token costs for customers and foster an ecosystem where partners can generate more value than Microsoft captures internally. Investments will support both diverse client needs and internal products such as Copilot, which now has over 30 million paid seats.

The letter also reported robust FY2026 performance: revenue of $331.8 billion, a 27% jump in cloud revenue to $214.4 billion, Azure growth of 41% crossing the $100 billion mark, and operating income up 21% to $155.2 billion. Nadella said these trends reinforce confidence in long-term returns and shareholder value.