Databricks vs Microsoft: Revenue, Profit and Business Model
Databricks reported $7B of revenue in FY2026 and — of net income. Microsoft reported $331.8B of revenue in FY2026 and $133.7B of net income.
Latest financial snapshot
Databricks
- Latest revenue
- $7B (FY2026)
- Net income
- —
- Net margin
- 0.0%
- Revenue growth
- +109.2% a year, FY2024–FY2026
Microsoft
- Latest revenue
- $331.8B (FY2026)
- Net income
- $133.7B
- Net margin
- 40.3%
- Revenue growth
- +14.7% a year, FY2017–FY2026
Financial summary
Databricks
Databricks does not publish audited financial statements because it is private, but it discloses key metrics with each funding round. Revenue for the fiscal year ended January 31, 2024 topped $1.6 billion. The revenue run-rate reached $5.4 billion in Q4 FY2026 (growth above 65%) and passed $7 billion in Q2 FY2027, the quarter ended July 31, 2026, with growth above 80%. Net retention has been reported above 140%, and the company says adjusted free cash flow has been positive over the trailing 12 months. Within that total, the Lakehouse data warehousing product passed a $1.5 billion run-rate, growing more than 100%, and Lakebase passed $100 million. More than 1,000 customers consume at over $1 million a year and more than 100 at over $10 million. Valuation rose from $62 billion (December 2024) to more than $100 billion (2025), $134 billion (February 2026), and $190 billion (August 2026).
Microsoft
Microsoft's FY2026 revenue rose 17.8% to $331.8 billion, operating income rose 21% to $155.2 billion, and GAAP net income rose 31% to $133.7 billion. Fourth-quarter revenue was $90.0 billion (up 18%) with net income of $35.8 billion, helped by a $3.2 billion gain on its Anthropic investment. Microsoft Cloud revenue reached $59.3 billion in Q4, up 27%. The main pressure point is capital intensity: AI data center spending has pushed free cash flow growth well below earnings growth.
Revenue and profit by year
Databricks
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $7B | — | 0.0% | +169.2% | Source |
| FY2025 | $2.6B | — | 0.0% | +62.5% | Source |
| FY2024 | $1.6B | — | 0.0% | — | Source |
Microsoft
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $331.8B | $133.7B | 40.3% | +17.8% | Source |
| FY2025 | $281.7B | $101.8B | 36.1% | +14.9% | Source |
| FY2024 | $245.1B | $88.1B | 36.0% | +15.7% | Source |
| FY2023 | $211.9B | $72.4B | 34.1% | +6.9% | Source |
| FY2022 | $198.3B | $72.7B | 36.7% | +18.0% | Source |
| FY2021 | $168.1B | $61.3B | 36.5% | +17.5% | Source |
| FY2020 | $143B | $44.3B | 31.0% | +13.6% | Source |
| FY2019 | $125.8B | $39.2B | 31.2% | +14.0% | Source |
| FY2018 | $110.4B | $16.6B | 15.0% | +14.3% | Source |
| FY2017 | $96.6B | $25.5B | 26.4% | — | Source |
Where the revenue comes from
Databricks
- Data Engineering & Streaming (Lakeflow, Spark)
Not disclosed
DBU consumption for batch and streaming pipelines, ingestion, and transformation jobs.
- Lakehouse Data Warehousing (Databricks SQL)
Run-rate above $1.5B (Aug 2026)
Serverless SQL warehousing and BI queries on open-format data; Databricks says this line is growing over 100% year over year.
- AI, Agents & Model Serving (Mosaic AI, Agent Bricks, Genie)
Not disclosed
Consumption from model training and fine-tuning, vector search, model serving, and AI agents.
- Lakebase Operational Database
Run-rate above $100M (Aug 2026)
Serverless Postgres usage by applications and AI agents.
Microsoft
- Productivity And Business ProcessesMajor
Office, Microsoft 365, LinkedIn, Dynamics, and related cloud services.
- Intelligent CloudMajor
Azure, server products, enterprise services, and cloud infrastructure.
- More Personal ComputingMajor
Windows, devices, gaming, search, and advertising.
- AI Services And CopilotsGrowth
AI features and model-powered services embedded across Azure, Microsoft 365, GitHub, security, and developer tools.
Business model and strategy
Databricks
How it makes money
Databricks makes money by charging for compute consumed on its platform, measured in Databricks Units (DBUs). Customers usually sign annual or multi-year committed-spend contracts and then draw them down as their engineers run pipelines, SQL queries, model training, model serving, and AI agents. There is no flat seat fee for most workloads, so revenue rises as data volumes and AI usage grow.
Growth strategy
Databricks is expanding from analytics into the systems that enterprise AI agents run on. The 2026 funding is earmarked for three products: Lakebase, a serverless Postgres database for agents built on the 2025 acquisition of Neon; Genie, an AI coworker that answers business questions from governed data; and Unity AI Gateway, which routes requests across AI models with governance and cost controls.
Competitive advantage
Databricks' absolute competitive advantage is its foundational connection to the open-source community, specifically 'Apache Spark'. The founders of Databricks literally invented Apache Spark (the large, open-source data processing engine used by nearly every tech company on earth).
Microsoft
How it makes money
Microsoft reports three segments. Intelligent Cloud covers Azure, SQL Server, Windows Server, GitHub, Nuance, and enterprise services; server products and cloud services alone brought in $129.4 billion in FY2026, and Azure passed $100 billion in annual revenue for the first time.
Growth strategy
Microsoft's growth plan centers on AI capacity and AI subscriptions. It is spending heavily on data centers and chips to meet Azure demand that management says remains capacity constrained, and it is selling Microsoft 365 Copilot as a paid add-on, which passed 30 million paid seats by the end of FY2026.
Competitive advantage
Microsoft's main advantage is distribution inside enterprises. Identity (Entra), email and documents (Microsoft 365), collaboration (Teams), developer tools (GitHub, Visual Studio), and cloud infrastructure (Azure) are often bought together, which raises switching costs and lets Microsoft attach new products such as Copilot to existing contracts.
Questions about Databricks vs Microsoft
Which company has higher revenue — Databricks, Inc. or Microsoft Corporation?
Databricks, Inc. reported $7.0B (FY2026), while Microsoft Corporation reported $331.8B (FY2026). By last reported revenue, Microsoft Corporation is the larger business, with Databricks, Inc. reporting a smaller revenue base.
What is the market cap of Databricks, Inc. vs Microsoft Corporation?
Microsoft Corporation has a market capitalisation of $3.83T. A public market cap figure for Databricks, Inc. was not available (it may be privately held).
Which is more financially efficient — Databricks, Inc. or Microsoft Corporation?
Databricks, Inc. generates $500k / employee in revenue per employee, while Microsoft Corporation generates $1.49M / employee. Microsoft Corporation shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Databricks, Inc. and Microsoft Corporation make money?
Databricks, Inc. and Microsoft Corporation generate revenue in fundamentally different ways. Databricks, Inc.: Databricks makes money by charging for compute consumed on its platform, measured in Databricks Units (DBUs). Microsoft Corporation: Microsoft reports three segments.
Is Databricks, Inc. bigger than Microsoft Corporation?
By last reported revenue, Microsoft Corporation ($331.8B (FY2026)) is the larger company compared to Databricks, Inc. ($7.0B (FY2026)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Databricks vs Microsoft overview