Microsoft's revenue and cloud revenue exceeded expectations
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Microsoft reported better-than-expected revenue and cloud revenue in its earnings report Thursday, cheering investors who were looking for signs that its investments in artificial intelligence are paying off.
Sales for the three months ended March 31 rose 17% to $61.9 billion, compared with analysts' expectations of $60.8 billion.sales in Microsoft's The company's cloud division, which includes its Azure computing platform and its biggest revenue driver, also exceeded expectations.
The Seattle-based company's stock has risen 7.6% this year, making it the world's most valuable company by market capitalization, and was up 4.5% in after-hours trading.
Microsoft is leading the way in the rapid development of generative AI industrysecured an early lead thanks to a $13 billion investment in OpenAI, the company behind ChatGPT.
But after more than a year of excitement about the technology, investors are looking for evidence that Big Tech companies can turn huge investments in generative AI into payments to customers and healthy profits.
One product in the spotlight is Copilot, a generative AI assistant that is integrated into Microsoft's suite of productivity apps.
“Microsoft Copilot and the Copilot stack are orchestrating a new era of AI transformation to drive better business outcomes across every role and industry,” said Satya Nadella, Chairman and Chief Executive Officer of Microsoft.
Microsoft warned in January that capital spending would increase “significantly.” cloud and investment in AI. Capital spending increased to $14 billion in the first three months of 2024, compared to $11.5 billion in the previous three months.
Shares in Meta, the parent company of Facebook and Instagram, plunged this week after the company warned that increased investment in AI would boost capital expenditures this year and next.
Microsoft's cloud revenue for the quarter rose 21% to $26.7 billion, compared to analysts' expectations, despite the company's January forecast that the division's revenue growth would slow to the low teens. compared to $1 billion.
Azure revenue rose 31% at constant currency, while Microsoft's growth outlook was 28%.
Microsoft said Azure revenue rose 7 points in the quarter, up from 6 points in the previous quarter and 3 points the quarter before that, driven by demand for its AI services.
Summarize this content to 100 words Unlock Editor's Digest for freeFT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.Microsoft reported better-than-expected revenue and cloud revenue in its earnings report Thursday, cheering investors who were looking for signs that its investments in artificial intelligence are paying off. Sales for the three months ended March 31 rose 17% to $61.9 billion, compared with analysts' expectations of $60.8 billion.sales in Microsoft's The company's cloud division, which includes its Azure computing platform and its biggest revenue driver, also exceeded expectations. The Seattle-based company's stock has risen 7.6% this year, making it the world's most valuable company by market capitalization, and was up 4.5% in after-hours trading.Microsoft is leading the way in the rapid development of generative AI industrysecured an early lead thanks to a $13 billion investment in OpenAI, the company behind ChatGPT. But after more than a year of excitement about the technology, investors are looking for evidence that Big Tech companies can turn huge investments in generative AI into payments to customers and healthy profits. One product in the spotlight is Copilot, a generative AI assistant that is integrated into Microsoft's suite of productivity apps. “Microsoft Copilot and the Copilot stack are orchestrating a new era of AI transformation to drive better business outcomes across every role and industry,” said Satya Nadella, Chairman and Chief Executive Officer of Microsoft.Microsoft warned in January that capital spending would increase “significantly.” cloud and investment in AI. Capital spending increased to $14 billion in the first three months of 2024, compared to $11.5 billion in the previous three months.Shares in Meta, the parent company of Facebook and Instagram, plunged this week after the company warned that increased investment in AI would boost capital expenditures this year and next. Microsoft's cloud revenue for the quarter rose 21% to $26.7 billion, compared to analysts' expectations, despite the company's January forecast that the division's revenue growth would slow to the low teens. compared to $1 billion.Azure revenue rose 31% at constant currency, while Microsoft's growth outlook was 28%.Microsoft said Azure revenue rose 7 points in the quarter, up from 6 points in the previous quarter and 3 points the quarter before that, driven by demand for its AI services.
https://www.ft.com/content/ec683341-5765-454d-97f7-76a2502ad66e Microsoft's revenue and cloud revenue exceeded expectations
