Microsoft’s $75 bn cloud revenue and profit exceed estimates
Microsoft announced on Wednesday that its annual revenue for the leading cloud computing platform increased by 34 percent, reaching $75 billion. The Azure cloud business has emerged as a focal point in Microsoft’s strategic pivot towards artificial intelligence. The software giant reported a fiscal fourth-quarter profit of $34.3 billion, translating to $3.65 per share, surpassing analyst expectations of $3.37 per share.
Revenue reached $76.4 billion in the April-June period, reflecting an 18 percent increase compared to the previous year. According to a survey conducted by FactSet Research, analysts had anticipated revenue to reach $73.86 billion. Microsoft has declared the termination of approximately 15,000 employees this year, despite a significant increase in its profits. Last week, Microsoft CEO Satya Nadella conveyed to employees that the layoffs were a significant burden for him, yet he framed them as a chance to redefine the company’s mission in the context of an AI-driven future.
Wall Street has responded positively to the promises of a more streamlined approach, particularly as Microsoft and other major technology firms seek to rationalize substantial capital expenditures necessary for the data centers, chips, and various components essential for advancing AI technology. Following the release of its earnings last week, Google announced an increase in its capital expenditures budget by an additional $10 billion, bringing the total to $85 billion. Microsoft is anticipated to provide comparable guidance in the near future.
