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Azure VM Cost Calculator

Price an Azure VM fleet across 730 monthly hours with reserved-instance terms, Windows licensing and Azure Hybrid Benefit.

Inputs

VMs
USD/hour

List price for the size and region — a D2s v5 Linux VM is roughly $0.096/hour.

hours

Azure bills a full month as 730 hours.

vCPU

Windows Server licensing is charged per vCPU-hour.

USD/vCPU-hour

Brings your own Software Assurance licence and removes the Windows charge.

Monthly Cost

$411.72

Compute Charge

$210.24

Windows Licence Charge

$201.48

Cost per VM

$137.24

Saving vs Pay-as-you-go

$0.00

Discount Achieved

0.0%

Annual Cost

$4,940.64

Step by step

  1. Values used

    Number of VMs = 3 VMs; Compute rate per VM = 0.0960 USD/hour; Billed hours per month = 730 hours; Commitment term = Pay-as-you-go (no commitment); Operating system = Windows Server; vCPUs per VM = 2 vCPU; Windows licence rate = 0.0460 USD/vCPU-hour; Apply Azure Hybrid Benefit = No

  2. Azure VM Cost

    monthly = VMs × compute rate × 730 × commitment factor + VMs × vCPUs × Windows licence rate × 730 (licence dropped under Azure Hybrid Benefit).

  3. Monthly Cost

    = 411.72

  4. Compute Charge

    = 210.24

  5. Windows Licence Charge

    = 201.48

  6. Cost per VM

    = 137.24

  7. Saving vs Pay-as-you-go

    = 0.00

  8. Discount Achieved

    = 0.0

How it works

Azure meters a VM per second but bills a full month as 730 hours, so the compute line is simply rate × hours × instances. A reservation replaces the pay-as-you-go rate with a lower committed rate for the whole term, while the Windows Server licence is a separate per-vCPU meter that Azure Hybrid Benefit removes when you bring a Software Assurance licence. Compute is usually the largest line on an Azure invoice, and the same VM can differ by more than 60% between pay-as-you-go and a 3-year reservation with Hybrid Benefit — confirm the current rates in the Azure pricing calculator for your region before you commit.

Formula

Azure VM Cost

monthly = VMs × compute rate × 730 × commitment factor + VMs × vCPUs × Windows licence rate × 730 (licence dropped under Azure Hybrid Benefit).

730
Hours Azure bills for a full calendar month
commitment factor
Reserved-instance price as a fraction of pay-as-you-go
licence rate
Windows Server charge per vCPU-hour on top of the Linux rate

Frequently Asked Questions

How is Azure VM Cost calculated?

monthly = VMs × compute rate × 730 × commitment factor + VMs × vCPUs × Windows licence rate × 730 (licence dropped under Azure Hybrid Benefit). Azure meters a VM per second but bills a full month as 730 hours, so the compute line is simply rate × hours × instances. A reservation replaces the pay-as-you-go rate with a lower committed rate for the whole term, while the Windows Server licence is a separate per-vCPU meter that Azure Hybrid Benefit removes when you bring a Software Assurance licence.

Why does Azure VM Cost matter?

Compute is usually the largest line on an Azure invoice, and the same VM can differ by more than 60% between pay-as-you-go and a 3-year reservation with Hybrid Benefit — confirm the current rates in the Azure pricing calculator for your region before you commit.

What values do I need to enter?

This calculator takes 8 inputs: Number of VMs, Compute rate per VM, Billed hours per month, Commitment term, Operating system, vCPUs per VM, Windows licence rate, Apply Azure Hybrid Benefit. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.

Does a reservation cover the Windows licence?

No. A reserved VM instance discounts only the compute meter. The Windows Server licence continues to bill per vCPU-hour unless you apply Azure Hybrid Benefit, which is why the two lines are separated here.

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