Microsoft Earnings: Stock Jumps As AI Drives Record Profits
Microsoft’s third calendar quarter earnings were the most robust in the company’s five-decade history, as the Washington-based computing colossus enjoys a bump from the next generation of technological innovation in generative artificial intelligence.
Microsoft CEO Satya Nadella speaks in May.
AFP via Getty Images Key FactsIn its earnings report released Wednesday afternoon, Microsoft reported record $3.30 earnings per share and net income of $24.7 billion, beating average analyst forecasts of $3.10 EPS and $23.2 billion net profit, according to FactSet.
The firm brought in $65.6 billion in revenue for the three-month period ending Sept. 30, besting estimates of $64.6 billion and the prior quarter’s record $64.7 billion.
Sales in Microsoft’s cloud computing service Azure grew 33% year-over-year, also crushing projections of 28.6% growth for Azure, the most public-facing generative AI initiative for Microsoft.
Shares of Microsoft gained 2% in after hours trading.
Microsoft’s report is the latest in a crowded week for earnings, following Google’s Tuesday release and frontrunning Thursday afternoon reports from fellow tech titans Amazon and Apple. The first quarter of Microsoft’s 2025 fiscal year, this quarter was also the first since Microsoft adjusted how it reports its business segment performance, a shuffle analysts say should better reflect the competition between Azure and rival enterprise cloud computing service Amazon Web Services. But it’s a change which Bernstein analyst Mark Shmulik predicted may cause “confusion” among investors following this report as expectations recalibrate for Microsoft’s wide-spanning businesses. Microsoft is one of the most profitable companies in the world, with its $88 billion in net income during its most recent fiscal year trailing only Apple and Berkshire Hathaway among U.S. companies.
Big Number87%. That’s how much Microsoft stock is up over the last two years through Wednesday’s close, outgaining the S&P 500 and rival Apple at 54% and 50%, respectively, according to FactSet data including reinvested dividends.
Follow me on Twitter or LinkedIn. Send me a secure tip.
