by: Maxim Lukiyanov, PhD, Principal PM Manager

This week at Microsoft Build conference, we're excited to unveil a suite of new Generative AI capabilities in Azure Database for PostgreSQL flexible server. These features unlock a new class of applications powered by an intelligent database layer, expanding the horizons of what application developers can achieve. In this post, we’ll give you a brief overview of these announcements.

Data is the fuel of AI. Looking back, the intelligence of Large Language Models (LLMs) can be reframed as intelligence that emerged from the vast data they were trained on. The LLMs just happened to be this technological leap necessary to extract that knowledge, but the knowledge itself was hidden in the data all along.

In modern AI applications, the Retrieval-Augmented Generation (RAG) pattern applies this same principle to real-time data. RAG extracts relevant facts from data on the fly to augment an LLM’s knowledge. At Microsoft, we believe this principle will continue to transform technology. Every bit of data will be squeezed dry of every bit of knowledge it holds. And there’s no better place to find the most critical and up-to-date data than in databases.

Today, we're excited to announce the next steps on our journey to make databases smarter – so they can help you capture the full potential of your data.

Fast and accurate vector search with DiskANN

First, we’re announcing the General Availability of DiskANN vector indexing in Azure Database for PostgreSQL. Vector search is at the heart of the RAG pattern, and it continues to be a cornerstone technology for the new generation of AI Agents - giving it contextual awareness and access to fresh knowledge hidden in data. DiskANN brings years of state-of-the-art innovation in vector indexing from Microsoft Research directly to our customers.

This release introduces supports for vectors up to 16,000 dimensions — far surpassing the 2,000-dimension limit of the standard pgvector extension in PostgreSQL. This enables the development of highly accurate applications using high-dimensional embeddings. We’ve also accelerated index creation with enhanced memory management, parallel index building, and other optimizations – delivering up to 3x faster index builds while reducing disk I/O.

Additionally, we're excited to announce the Public Preview of Product Quantization – a cutting-edge vector compression technique that delivers exceptional compression while maintaining high accuracy. DiskANN Product Quantization enables efficient storage of large vector volumes, making it ideal for production workloads where both performance and cost matter.

With Product Quantization enabled, DiskANN offers up to 10x faster performance and 4x cost savings compared to pgvector HNSW. You can learn more about DiskANN in a dedicated blog post.

Semantic operators in the database

Next, we’re announcing the Public Preview of Semantic Operators in Azure Database for PostgreSQL – bringing a new intelligence layer to relational algebra, integrated directly into the SQL query engine.

While vector search is foundational to the Generative AI (GenAI) apps and agents, it only scratches the surface of what’s possible. Semantic relationships between elements of the enterprise data are not visible to the vector search. This knowledge exists within the data but is lost at the lowest level of the stack – vector search – and this loss propagates upward, limiting the agent’s ability to reason about the data.

This is where new Semantic Operators come in.

Semantic Operators leverage LLMs to add semantic understanding of operational data. Today, we’re introducing four operators:

• generate() – a versatile generation operator capable of ChatGPT-style responses.
• is_true() – a semantic filtering operator that evaluates filter conditions and joins in natural language.
• extract() – a knowledge extraction operator that extracts hidden semantic relationships and other knowledge from your data, bringing a new level of intelligence to your GenAI apps and agents.
• rank() - a highly accurate semantic ranking operator, offering two types of state-of-the-art re-ranking models: Cohere Rank-v3.5 or OpenAI gpt-4.1 models from Azure AI Foundry Model Catalog.

You can learn more about Semantic Operators in a dedicated blog post.

Graph database and GraphRAG knowledge graph support

Finally, we’re announcing the General Availability of GraphRAG support and the General Availability of the Apache AGE extension in Azure Database for PostgreSQL. Apache AGE extension on Azure Database for PostgreSQL offers a cost-effective, managed graph database service powered by PostgreSQL engine – and serves as the foundation for building GraphRAG applications.

The semantic relationships in the data once extracted can be stored in various ways within the database. While relational tables with referential integrity can represent some relationships, this approach is suboptimal for knowledge graphs. Semantic relationships are dynamic; many aren’t known ahead of time and can’t be effectively modeled by a fixed schema.

Graph databases provide a much more flexible structure, enabling knowledge graphs to be expressed naturally. Apache AGE supports openCypher, the emerging standard for querying graph data. OpenCypher offers an expressive, intuitive language well-suited for knowledge graph queries.

We believe that combining semantic operators with graph support in Azure Database for PostgreSQL creates a compelling data platform for the next generation of AI agents — capable of effectively extracting, storing, and retrieving semantic relationships in your data. You can learn more about graph support in a separate blog post.

Resources to help you get started

We’re also happy to announce availability of the new resources and tools for application developers:

• Model Context Protocol (MCP) is an emerging open protocol designed to integrate AI models with external data sources and services. We have integrated MCP server for Azure Database for PostgreSQL into the Azure MCP Server, making it easy to connect your agentic apps not only to Azure Database for PostgreSQL, but to other Azure services as well through one unified interface. To learn more, refer to this blog post.
• New Solution Accelerator which showcases all of the capabilities we have announced today working together in one solution solving real world problems of ecommerce retail reimagined for agentic era.
• New PostgreSQL extension for VSCode for application developers and database administrators alike, bringing new generation of query editing and Copilot experiences to the world of PostgreSQL.
• And read about New enterprise features making Azure Database for PostgreSQL faster and more secure in the accompanying post.

Begin your journey

Generative AI innovation continues its advancement, bringing new opportunities every month. We’re excited for what is to come and look forward to sharing this journey of discovery with our customers. With today’s announcements - DiskANN vector indexing, Semantic Operators, and GraphRAG - Azure Database for PostgreSQL is ready to help you explore new boundaries of what’s possible.

We invite you to begin your Generative AI journey today by exploring our new Solution Accelerator.