Microsoft

Microsoft is an American technology company headquartered in Redmond, Washington, that develops software, cloud services, devices and online services. In its fiscal year ended June 30, 2026, it reported total revenue of $331.8 billion, according to its annual report filed with the U.S. Securities and Exchange Commission (SEC). Its stated mission is to empower every person and every organization on the planet to achieve more.

History of Microsoft

Childhood friends Bill Gates and Paul Allen founded Microsoft on April 4, 1975, according to HISTORY. The company started in Albuquerque, New Mexico, where it wrote a BASIC programming language interpreter for an early hobbyist microcomputer called the Altair 8800. It moved to Washington State in 1979 and went public in 1986. A year later, Gates became the world’s youngest billionaire at age 31.

The company’s rise is closely tied to the IBM Personal Computer, which launched in August 1981. Microsoft supplied its operating system, MS-DOS, and kept the right to license it to other computer makers. An operating system is the core software that manages a computer’s hardware and runs other programs.

Windows 1.0 appeared in November 1985 as a graphical layer on top of MS-DOS. Microsoft released the Office suite of applications in 1990 and Windows 95 in August 1995. Paul Allen left the company in 1983 after a cancer diagnosis, and Gates led it as chief executive until later handing over the role.

Products and services of Microsoft

Microsoft reports its business in three segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The first covers workplace software such as Microsoft 365 and the professional network LinkedIn. The second centers on server products and the Azure cloud computing platform, which rents computing power and storage to customers over the internet. The third includes Windows, devices, gaming and search advertising.

Cloud services are now the largest driver of growth. Microsoft Cloud revenue rose 27 percent to $214.4 billion in fiscal 2026, and revenue from Azure and other cloud services increased 41 percent. The company’s remaining performance obligation for commercial customers, which is the value of contracted work not yet delivered, grew 84 percent to $678 billion.

Search advertising revenue, excluding traffic acquisition costs, increased 12 percent in fiscal 2026. Traffic acquisition costs are the payments a search service makes to partners that send it users.

Other lines moved differently. LinkedIn revenue grew 11 percent, and Dynamics 365, a business software suite, grew 18 percent. Windows revenue from computer makers and devices fell slightly, and Xbox content and services revenue decreased 5 percent.

The annual report presents artificial intelligence as a central part of its strategy and says the company wants to make AI broadly available and to do so responsibly.

Corporate structure and operations

Microsoft’s corporate headquarters are in Redmond, Washington. The company uses about 14 million square feet of space in King County, Washington, for engineering, sales and other functions. Its shares trade on the Nasdaq Stock Market.

As of June 30, 2026, Microsoft employed approximately 223,000 people full time, including 121,000 in the United States and 102,000 in other countries. About 89,000 of them worked in operations, which includes product support and consulting.

Revenue has grown steadily across recent fiscal years. It was $245.1 billion in fiscal 2024, $281.7 billion in fiscal 2025 and $331.8 billion in fiscal 2026. Operating income, the profit from running the business before interest and taxes, reached $155.2 billion in fiscal 2026. Net income was $133.7 billion, compared with $101.8 billion a year earlier.

The annual report says this segment structure lets management align strategy across its development, sales, marketing and services teams, and gives it a framework for deciding where to put resources.

The company’s fiscal year runs from July 1 to June 30. This means that its fiscal 2026 covers the period from July 2025 to June 2026.

Impact of Microsoft

Microsoft helped make the personal computer a standard tool for offices and homes. The combination of Windows and Office placed the same programs on millions of desks, and companies built their own systems around those standards. The company’s licensing model, in which it sells software to many hardware makers instead of building computers itself, also shaped how the industry developed.

In recent years the company’s influence has moved toward the cloud. Businesses and governments rent Azure capacity for storage, analysis and machine learning instead of running all of their own servers. Microsoft 365 moved familiar office tools into subscriptions that are updated continuously.

Scale is a core part of the cloud business. The annual report says large datacenters can deploy computing resources at a significantly lower cost per unit than smaller ones, which favors providers that can build and run them at volume.

Microsoft also operates widely used platforms for developers and professionals, including the LinkedIn network. These platforms give the company a role in how people work, hire and build software.

Criticism and controversies

Antitrust scrutiny has followed Microsoft since 1990, when the U.S. Federal Trade Commission examined its relationship with IBM. In 1994 the Department of Justice’s Antitrust Division filed a statement alleging that the company had pressed computer makers into per-processor license fees whether or not they used a Microsoft product. A larger case followed in the late 1990s over the way Microsoft bundled and promoted its web browser with Windows. A proposed settlement with the Department of Justice was published in the Federal Register in November 2001.

The antitrust law debate centered on whether a company with a dominant operating system could use that position to limit competition in other markets. The outcome influenced how regulators later approached other large technology firms.

In recent years, concerns have shifted to cloud licensing, competition in artificial intelligence and data security. Microsoft’s annual report lists regulatory action, litigation and cybersecurity incidents among the risks that could affect its business.

Editorially reviewed by Specialty Digest Editorial TeamLast reviewed November 4, 2026Researched and drafted with AI assistanceReport an issue