Microsoft's Upswing Thanks to AI and Cloud - Revenue Exceeds Analysts' Expectations

Microsoft recorded an impressive 16 percent increase in revenue in the latest fiscal quarter. The main driver of this development is the rising demand for cloud computing, accompanied by a boom in the use of AI tools. In the first quarter of the fiscal year, Microsoft achieved a revenue of $65.6 billion, surpassing analysts' forecasts of $64.5 billion. Net profit grew by 11 percent to $24.7 billion in the three months to the end of September, well above the expected mark of $23.1 billion. "The AI-driven transformation is changing work in every role, function, and business process," said CEO Satya Nadella. He added that Microsoft is acquiring new customers by helping them apply its AI platforms. Revenue in the cloud segment, Microsoft's largest revenue driver, which includes the Azure cloud platform, also exceeded expectations. It rose by an impressive 22 percent year-over-year to $38.9 billion. Microsoft is considered one of the main beneficiaries of the broad acceptance of AI, driven by the increasing demand for its Azure data centers and the strong interest in the partnership with market leader OpenAI. This has made Microsoft the third most valuable publicly traded company in the world. Microsoft's stock has already risen about 16 percent this year and gained an additional 0.8 percent in after-hours trading. With a valuation of $3.3 trillion, Microsoft is second only to Apple and Nvidia. Meanwhile, competitor Google saw its share price rise by 4 percent after it also reported strong growth figures in its cloud business on Tuesday.