Databricks and Microsoft expand partnership to help enterprises bring business context to enterprise AI

• Databricks and Microsoft extend strategic partnership through the 2030s to scale enterprise AI
• Databricks deepens its bet on Azure, growing its use of Azure Databricks to run its own core business operations and analytics, while both companies advance native integration across the Microsoft stack, including Databricks Genie and Microsoft 365
• Databricks increases its use of Microsoft Azure Cobalt to improve performance and efficiency

REDMOND, Wash. and SAN FRANCISCO, July 23, 2026 /PRNewswire/ -- Microsoft Corp. and Databricks on Wednesday announced an expansion of their decade-long strategic partnership, extending into the 2030s. Databricks will deepen its use of Azure Databricks to run core business operations and build its unified lakehouse, while leveraging Azure Cobalt, Microsoft's next-generation Arm-based infrastructure, to improve performance and efficiency. Microsoft will also continue integrating Databricks Data and AI platform across its products, bringing capabilities like Genie, Databricks' AI co-worker, directly into customer workflows. Together, the companies are helping enterprises build AI grounded in their own business context with the cost efficiency, control and choice needed to scale successfully.

Enterprises want AI that understands their customers, products, operations, metrics and business processes, all while running securely where work happens. Yet, most still struggle to connect AI to trusted business knowledge, govern models and agents consistently, and control costs. Microsoft and Databricks are helping customers close that gap: 

"For nearly a decade, Databricks and Microsoft have helped enterprises innovate with data and AI," said Ali Ghodsi, Co‑Founder and CEO of Databricks. "Today, our partnership is stronger than ever. With Databricks Genie and Unity AI Gateway deeply integrated across Microsoft's products, we're helping enterprises unify their data and ground AI in business knowledge. This lets customers get the full benefits of agents and models while controlling costs and ensuring governance."

"The next generation of AI will be defined by how effectively organizations turn their unique knowledge into intelligence," said Judson Althoff, CEO, Microsoft Commercial Business. "Microsoft and Databricks are helping customers connect data, AI and business context to accelerate decision-making and drive measurable impact. With Databricks deepening its investment in Azure Databricks and Azure Cobalt-powered infrastructure, customers will benefit from greater performance, efficiency and scale for their most demanding workloads. Databricks' decision to run its own core business operations on Azure Databricks also gives customers confidence in a platform proven at enterprise scale."

Databricks runs core business operations on Azure Databricks 

As part of this latest deal, Databricks deepens its commitment to Azure, running its own core business operations and analytics on Azure Databricks, using the very platform it delivers to customers at scale.

Advancing performance with Azure Cobalt

Databricks will also expand its use of Azure Cobalt, Microsoft's next-generation Arm-based infrastructure, to improve performance and efficiency for agentic and data-intensive workloads. Databricks currently uses Cobalt 100 and plans to adopt Cobalt 200, which delivers up to 50% better performance and includes memory encryption enabled by default.

Deep integrations for Databricks Genie and Unity AI Gateway with Microsoft product stack

By combining the Databricks Data + AI Platform with Azure's global scale, customers can accelerate AI transformation while maintaining control and reliability. As a native Azure service, Azure Databricks makes its AI capabilities available directly within customers' existing Microsoft environment, grounding and operating agents on enterprise data with Genie and Genie Ontology, and governing models, agents and cost through Unity AI Gateway. Deeply integrated across the Microsoft ecosystem spanning Microsoft Entra, Azure Data Lake Storage, Azure security, Microsoft OneLake, Power BI, Microsoft Purview, Microsoft Foundry, Power Platform, Microsoft 365, Teams and Copilot, these capabilities bring governed, real-time data and AI into business workflows, giving organizations the context, control, choice and cost efficiency needed to drive impact.

Continued investment is evident from our recent announcements with Databricks at Data + AI Summit in June.

Customer impact with Azure Databricks

The deepened collaboration strengthens support for joint customers running data, analytics and AI workloads on Azure Databricks, delivering improved performance, security, AI governance and enterprise readiness. Thousands of customers, including Banco Bradesco, the Cincinnati Reds, Electrolux, SMBC and Unilever, already use Azure Databricks to run critical workloads and scale AI with confidence.

Read more on the proven business value of the Databricks and Microsoft partnership on the Microsoft Azure blog.

About Databricks

Databricks is the Data and AI company. More than 20,000 organizations worldwide — including AT&T, Bayer, BMW Group, HSBC, T-Mobile, Unilever, and 70% of the Fortune 500 — rely on Databricks Data + AI Platform to build and scale data and AI apps, analytics and agents. Headquartered in San Francisco with 30+ offices around the globe, Databricks offers a unified platform that includes Genie, Lakebase, Agent Bricks, Lakeflow, Lakehouse, and Unity Catalog. To learn more, follow Databricks on LinkedIn, X, YouTube, and Instagram.

About Microsoft

Microsoft (Nasdaq "MSFT" @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

SOURCE Microsoft Corp.