Nonlinear interferometers that replace beam splitters in Mach-Zehnder interferometers with nonlinear amplifiers for quantum-enhanced phase measurements have drawn increasing interest in recent years, but practical quantum sensors based on nonlinear interferometry remain an outstanding challenge. Here, we demonstrate the first practical application of nonlinear interferometry by measuring the displacement of an atomic force microscope microcantilever with quantum noise reduction of up to 3 dB below the standard quantum limit, corresponding to a quantum-enhanced measurement of beam displacement of 1.7 fm/sqrt[Hz]. Further, we minimize photon backaction noise while taking advantage of quantum noise reduction by transducing the cantilever displacement signal with a weak squeezed state while using dual homodyne detection with a higher power local oscillator. This approach may enable quantum-enhanced broadband, high-speed scanning probe microscopy.