Microsoft Azure growth rate continues to slow

Microsoft’s Azure cloud business is once again growing at a slower rate.

In reporting earnings for its fiscal first quarter on Wednesday, Microsoft revealed revenue growth in its Azure division slowed to 59%, down from 64% the previous quarter. The growth rate has largely been declining since the third quarter of Microsoft’s 2018 fiscal year.

Microsoft doesn’t disclose Azure’s revenue in dollar amounts, but its growth rate has been declining as it expands. Amazon Web Services, the leader in the space, has also seen its growth rate slow.

In the fourth quarter of 2019, the Intelligent Cloud segment, which includes Azure, was Microsoft’s biggest segment by revenue. It dropped behind both the productivity and business processes unit and the personal computing segment during the first quarter.

Overall Microsoft beat expectations for its fiscal first quarter, which ended September 30. Revenue was up 14% to $33.1 billion from the year prior and earnings increased 21% to $1.38 a share. Analysts had forecast $1.25 a share and $32.2 billion in revenue, according to FactSet, which provides financial market data.

Microsoft shares didn’t change much on Wednesday after earnings were released. Its shares are up about 35% since the beginning of the year. The S&P 500 is up nearly 20% from the start of the year.