Bridging the Digital and Physical Worlds with Azure IoT Hub and Azure IoT Operations

Microsoft

Nov 18, 2025

Operational excellence starts with people. Empowering those people with the most up to date insights and recommendations requires bridging the gap between the physical and digital worlds to generate the best possible outcomes for real time decision making. Creating this bridge transforms data into insights, insights into intelligent actions, and actions into real-world results.

Digital Operations, integrated with AI insights, help make this possible by combining data from connected assets across a variety of physical locations and deployment topologies, and transforming that data into insights and decisions that scale using AI and Analytics.

At Microsoft Ignite, we’re extending this vision with new Azure IoT Hub and Azure IoT Operations capabilities to manage connected assets at scale, unify digital operations, and realize AI-enabled outcomes across your enterprise.

Connected Operations in Action

Azure IoT Hub and Azure IoT Operations form the backbone of connected operations, where every asset, sensor, and system contributes to a continuous loop of intelligence by moving data to Microsoft Fabric for real-time analytics, and for use with AI agents.

This pattern applies to nearly every sector of the economy. In manufacturing, these capabilities allow production engineers to predict and avoid equipment failures by analyzing vibration and temperature data at the edge before costly downtime occurs. In energy and utilities, distributed sensors can provide data to control points that help balance load, optimize grid efficiency, and ensure safe operations even in remote areas. In transportation and logistics, connected fleets use edge AI models to detect safety risks in real time, while cloud-based analytics optimize routing and fuel efficiency across entire regions. Across industries, this edge-to-cloud collaboration enables the ability for intelligent systems to sense, reason, and act in the physical world with speed, safety, and precision.

Digital Operations are enabled by capabilities in the edge and cloud working together in a seamless fashion

From Data to Intelligent Action

Organizations today must capture and act on data from both geographically dispersed and tightly collocated assets. That data needs to be processed close to where it’s generated, at the edge, to enable real-time decision-making, reduce latency, and enhance security.

At the same time, the cloud remains vital for contextualizing operational data with enterprise systems, training AI models, and managing a consistent identity and security framework across all assets. AI models trained in the cloud can then be deployed back to the edge, where they act on events in real time. Operators can work with AI agents to reason over this data whether it’s structured or unstructured, organized in silos, or contained in free-text fields, to provide results to a mixed team of human and AI operational assets.

We have a portfolio of products uniquely designed to make this continuum, from edge to cloud, more intelligent, secure, and repeatable. Together with our partners, we help bridge Operational Technology (OT) with Information Technology (IT) to deliver better business outcomes.

New at Ignite: Accelerating Digital Operations

We’re excited to share our latest set of investments at Ignite across our portfolio of services. A few key announcements:

Azure IoT Hub New Features (Preview): Simplifying Secure Connectivity at Scale

Azure IoT Hub empowers organizations to securely and reliably manage connected assets across the globe, providing real-time visibility and control over diverse operations. With proven scalability, broad device support, and robust management tools, IoT Hub delivers a unified platform for developing and operating IoT solutions. As customers evolve, Azure IoT Hub continues to advance, deepening its integration with the Azure ecosystem and enabling AI-driven, connected operations for the next generation of applications.

The next generation of Azure IoT Hub investments makes it easier and more secure than ever to connect and manage distributed assets. At Ignite, we’re previewing:

New certificate management capabilities that simplify device onboarding and lifecycle management.
Integration with Azure Device Registry (ADR) that brings all devices into a common control plane, enabling unified identity, security, and policy management.
ADR enhancements that make it easier to register, classify, and monitor assets, paving the way for consistent governance and operational insight across millions of devices.

This deeper Azure integration with ADR standardizes operations, simplifies oversight of edge portfolios including IoT devices, and brings the full power of Azure’s management ecosystem to IoT and Digital Operations workloads.

Azure IoT Operations New Features (GA): The Foundation for AI in the Physical World

Azure IoT Operations is more than an edge-to-cloud data plane, it’s the foundation for achieving AI in the physical world, enabling intelligent operational systems that can perceive, reason, and act to drive new operational efficiencies.

Built on Arc-enabled Kubernetes, Azure IoT Operations unifies operational and business data across distributed environments, eliminating silos and providing a repeatable, scalable foundation for autonomous, adaptive operations. By extending familiar Azure management concepts to physical sites, Azure IoT Operations creates an AI-ready infrastructure that supports autonomous, adaptive operations at scale.

Our latest GA release of Azure IoT Operations introduced major enhancements:

Wasm-powered data graphs deliver fast, modular analytics helping businesses make near real-time decisions at the edge.
Expanded connectors now include OPC UA, ONVIF, REST/HTTP, Server-Sent Events (SSE), and direct MQTT for richer industrial and IT integrations.
OpenTelemetry (OTel) endpoint support enables seamless telemetry pipelines and observability.
Asset health monitoring to provide unprecedented visibility and control.

These capabilities help bridge Information Technology, Operational Technology, and data domains, empowering customers to discover, collect, process, and send data using open standards while laying the groundwork for self-optimizing environments where AI agents and human supervisors collaborate seamlessly.

Integration with Fabric IQ and Digital Twin Builder

To fully unlock the value of connected data, organizations need to contextualize it, linking operational signals to business meaning. Fabric IQ, a new offering announced at Ignite, and Digital Twin Builder in Fabric make this possible, transforming raw telemetry into AI-ready context. This integration allows companies to model complex systems, run simulations, and create intelligent feedback loops across manufacturing, logistics, and energy environments.

Edge AI: Real-Time Intelligence in the Physical World

Azure’s AI capabilities for edge environments bring intelligence closer to where it matters most. And, because these services are Arc-enabled, organizations can develop, manage and scale AI workloads across diverse environments using consistent tooling. Today, we are announcing updates to two of our key services that enable AI at the edge:

Live Video Analysis features (Public Preview) in Azure AI Video Indexer enabled by Arc: delivers real-time agentic video intelligence to improve safety, quality, and operations.
Edge RAG (Retrieval Augmented Generation) Public Preview Refresh enables local generative AI reasoning with contextual awareness - empowering AI agents to act within industrial constraints securely and efficiently.

These innovations accelerate time to insight and help organizations deploy AI where milliseconds matter.

Partner Innovation: Scaling Real Business Value

Last year, we showcased the breadth of Azure IoT Operations’ industrial ecosystem. This year, we’re celebrating how partners are integrating, co-innovating, and scaling real customer outcomes.

Our partners are packaging repeatable, scalable solutions that connect operational data to enterprise systems—enabling AI-driven insights and automation across sites, regions, and industries.

At this year’s Ignite, we’re highlighting some great new partner innovations:

NVIDIA is working with Microsoft to enable factory digital twins using the OpenUSD standard
Siemens is enabling adaptive production through AI- and digital-twin-powered solutions supported by the integration of Siemens Industrial Edge with Azure IoT Operations
Litmus Edge integrates with Azure IoT Operations via the Akri framework to automatically discover industrial devices, enable secure data flows, and support Arc-enabled deployment.
Rockwell Automation is streamlining edge-to-cloud integration with its FactoryTalk Optix platform by delivering contextualized, AI-ready data seamlessly within Microsoft Azure IoT Operations architectures.
Sight Machine is driving advanced analytics for quality and efficiency across multi-site operations.

Through initiatives like Akri, Co-Innovate, and Co-Sell Readiness, our ecosystem is developing managed applications, packaged solutions, and marketplace offerings that accelerate deployment and unlock new revenue streams. These collaborations show how Azure IoT Operations is not just a platform, but a growth engine for industrial transformation.

The Path Forward

With these advancements, we’re helping organizations bring AI to the physical world by turning data into intelligence and intelligence into action. Customers like Chevron and Husqvarna are scaling beyond initial pilots, expanding their deployments from single-site to multi-site rollouts, unlocking new use cases from predictive maintenance to worker safety, and proving how adaptive cloud architectures deliver measurable impact across global operations.

By connecting assets, empowering partners, and delivering open, scalable platform solutions, Microsoft is helping industries achieve resilient, adaptive operations that drive measurable business value.

The digital and physical worlds are coming together with solutions that are secure, observable, AI-ready, and built to scale from a single site to global operations. Together, we’re creating a smarter, more connected future.

Learn More

Learn more about Azure IoT Hub and Azure IoT Operations here: Azure IoT – Internet of Things Platform | Microsoft Azure

Learn more about new IoT Hub public preview features here: Azure IoT Hub documentation

Discover Partner Solutions:

Learn how Litmus and Sight Machine are advancing industrial analytics and integration with Azure IoT Operations. Explore Rockwell Automation and Siemens for more on adaptive cloud architectures and shop floor intelligence.