Shares of Microsoft edged higher Wednesday evening after the tech giant reported better-than-expected results across all key metrics and signaled that growth in its all-important Azure cloud computing business continues to accelerate.
Revenue in the three months ended in September rose about 19% year over year to $92.28 billion, beating the LSEG consensus estimate of $90.69 billion
Adjusted earnings per share (EPS) totaled $4.92, up 32% from a year earlier, beating the $4.73 consensus, according to LSEG. Azure cloud revenue grew 48% year over year on a reported and constant-currency basis, beating FactSet consensus estimates of about 44% and 45%, respectively. MSFT 1Y mountain Microsoft 1-year stock performance Bottom line Earlier this year, Microsoft shares were down about 25%, trading in the mid-$300s on concerns that it had fallen behind in the AI race, that its seat-based subscription model was vulnerable to disruption, and that the company lacked innovation in its AI tools.
But that all changed in July: Azure revenue growth accelerated; momentum in Copilot paid seats grew; and, perhaps most importantly, the company separated itself from the other major hyperscalers by spending within its means and not burning through all its cash flow to support its AI efforts. The stock gained roughly 51% from its summer low in late June through Wednesday’s close. That rebound is likely to continue after another clean earnings report.