Microsoft announced 40% efficiency gains for its Copilot models driven by its custom Maia 200 AI chip developed in-house. This chip, deployed in data centers in Iowa and Arizona, delivers over 30% better tokens per dollar compared to previous hardware. Azure revenue surged 43% year-over-year in fiscal Q2 2026, while Microsoft’s AI business reached an annual recurring revenue run rate above $37 billion, representing a 123% increase from the prior year. Microsoft shares jumped more than 8% following the earnings report, despite $41 billion in AI infrastructure capital expenditures during the quarter.
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