Shares of Microsoft Corporation (NASDAQ: MSFT) jumped in extended trading Tuesday after the company announced its most robust sales growth in six quarters. This follows the resurgent growth in cloud computing and soaring demand for new artificial intelligence products, prompting corporate customers to rev up their spending.
The tech giant reported $56.5 billion in revenues for the fiscal first quarter of 2024, marking a 13% increase. This figure has topped analysts’ average projections. Microsoft also disclosed a profit of $2.99 per share in a statement released on Tuesday. The Azure cloud-services sales increased 29%, compared to a 26% growth in the previous quarter.
Microsoft is bullish about the future of its Azure business, with expectations of continued revenue acceleration for the rest of the fiscal year.
Microsoft Corporation (NASDAQ: MSFT) has substantially expanded its focus to encompass various AI-based offerings in the past year. In January 2023, the company announced a $10-billion investment in OpenAI, the creator of the widely popular ChatGPT large language model.
Shortly after, the company introduced new AI-powered versions of its Bing search engine and Edge browser, significantly enhancing its AI capabilities. In addition, the tech giant has rolled out a series of AI-based apps to support its various products.
Earlier this month, Microsoft acquired video game industry giant Activision Blizzard for a colossal $69 billion, following nearly two years of regulatory scrutiny, and it is also expected to impact Microsoft’s future earnings.
The market reacted positively to the news, with Microsoft shares reaching $351.95 in extended trading, up from a previous close of $330.53 in New York. The stock had dropped 7.3% in the past three months, more than the S&P 500 Index’s 3.6% decline during the same period.