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Microsoft has reported strong quarterly earnings, with the tech giant’s revenue climbing 13 per cent to $70.1 billion, largely fuelled by its thriving cloud computing and artificial intelligence sectors.
The figures, which surpassed Wall Street predictions, led to a surge of over eight per cent in Microsoft’s share price during after-hours trading.
The company also reassured investors that it remained resilient despite potential concerns over the trade policies of President Donald Trump’s administration, offering a positive outlook for the next quarter.
Marking its 50th anniversary this year, Microsoft saw net profits rise 18 per cent to $25.8 billion compared to the same period last year.
A key driver of this growth was its cloud business, with Microsoft Cloud revenue reaching $42.4 billion — a 20 per cent increase.
Chief Financial Officer Amy Hood credited the growth to ongoing demand for Microsoft’s “differentiated offerings.”
Microsoft has long been at the forefront of the AI boom, making significant investments since the 2022 launch of ChatGPT shook up the tech world.
The company is spending heavily — roughly $80 billion this fiscal year — to expand its infrastructure and meet AI-driven demand.
Despite these major outlays, CEO Satya Nadella said he was confident about the pace of investment but noted that securing sufficient energy to support AI data centres remained a top concern.
Microsoft also revealed that its relationship with OpenAI is shifting, and it will no longer be the exclusive provider of computing resources for the AI firm.
The company’s Intelligent Cloud division performed particularly well, with revenue rising 21 per cent to $26.8 billion. Azure and related cloud services saw 33 per cent growth, underscoring increasing adoption of Microsoft’s cloud platforms.
Meanwhile, the Productivity and Business Processes division — which includes Office 365 and LinkedIn — delivered $29.9 billion in revenue, representing a 10 per cent year-on-year increase. Microsoft returned $9.7 billion to shareholders in the form of dividends and share buybacks during the quarter.
Industry analyst Jeremy Goldman of Emarketer called it a “strong, steady quarter” for a company now reaping the rewards of its AI investments.
“Microsoft’s ability to turn AI hype into genuine revenue sets it apart in a market full of potential but few results,” he said.
