Microsoft shares surged by as much as 10% in pre-market trading on Thursday after the technology giant forecast stronger-than-expected revenue and accelerating growth at its Azure cloud business, offering fresh evidence that its vast investment in artificial intelligence is paying off.
The company expects revenue of between $89.85bn (€78.5bn) and $90.95bn (€79.5bn) in the July-September quarter, representing growth of 16% to 17%. It also forecast that Azure revenue would grow by approximately 45% in constant currency, up from 43% in the quarter just ended.
The upbeat outlook followed better-than-expected fiscal fourth-quarter results. Revenue rose 18% year-on-year to $90bn (€78.7bn) in the April-June period, beating the $87.6bn (€76.6bn) forecast by analysts surveyed by FactSet.
Net profit climbed 31% to a record $35.8bn (€31.3bn), although the figure was boosted by a $3.2bn (€2.8bn) unrealised gain on Microsoft’s investment in artificial intelligence company Anthropic. Diluted earnings per share reached $4.81 (€4.20), above analysts’ forecast of $4.24 (€3.71).
Microsoft Cloud revenue was $59.3bn (€51.9bn) in the quarter, up 27% year-on-year. The strong growth reflects higher demand across Microsoft’s cloud computing platform, Azure, as well as its first-party AI applications and services. Azure and other cloud services revenue increased by 43%.
