Microsoft and Alphabet's latest earnings show once again that it's all about the cloud
Microsoft's cloud helped to lift its fiscal first-quarter results after Google's parent reported similarly strong cloud growth a day earlier.
Microsoft’s cloud business played a big role in driving overall growth for the tech giant in the latest quarter, as more customers used the company’s cloud services for their AI-powered platforms and tools.
Microsoft cloud revenue in the first-fiscal quarter was $38.9 billion, up 22% year-over-year.
Much of that growth came from Microsoft Azure, the company’s public cloud computing platform, which saw 33% growth in revenue. Meanwhile, Microsoft 365 Commercial products and cloud services revenue increased 13%, or up 14% in constant currency.
Overall, Microsoft’s revenue for the quarter ending Sept. 30 was $65.6 billion, a 16% increase, or about $1 billion more than analysts had expected.
“AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process,” Microsoft CEO Satya Nadella said in a statement. “We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage.”
In after-hours trading on Wednesday, Microsoft’s shares rose just under 1% to $436. But later, a disappointing outlook for Azure growth in the current quarter—31% to 32% growth in the current quarter, versus 33% in the just reported one—sent the company’s stock into reverse, down 4%.
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