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| Microsoft’s heavy bet on AI pays off as it beats expectations in second quarter | Microsoft’s heavy bet on AI pays off as it beats expectations in second quarter |
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| World’s largest public company reports $61.86bn revenue after investing billions into artificial intelligence | World’s largest public company reports $61.86bn revenue after investing billions into artificial intelligence |
| Profits at Microsoft beat Wall Street’s expectations as its heavy bets on artificial intelligence and gaming continued to bear fruit in the second quarter. | Profits at Microsoft beat Wall Street’s expectations as its heavy bets on artificial intelligence and gaming continued to bear fruit in the second quarter. |
| The technology giant has invested billions of dollars into AI in a bid to turbocharge its growth. | The technology giant has invested billions of dollars into AI in a bid to turbocharge its growth. |
| “Microsoft Copilot and Copilot stack are orchestrating a new era of AI transformation, driving better business outcomes across every role and industry,” said Satya Nadella, the chief executive of Microsoft. The company highlighted that Microsoft’s cloud computing revenue was up by more than 20% compared to the same period last year. | “Microsoft Copilot and Copilot stack are orchestrating a new era of AI transformation, driving better business outcomes across every role and industry,” said Satya Nadella, the chief executive of Microsoft. The company highlighted that Microsoft’s cloud computing revenue was up by more than 20% compared to the same period last year. |
| Shares rose during after-hours trading in New York on Thursday. | Shares rose during after-hours trading in New York on Thursday. |
| With a stock market value of nearly $3tn, Microsoft is the world’s largest public company. Shares in the firm have increased by more than 30% over the past year – an impressive rise, although less than the rallies of Amazon and Google, whose stocks have risen by more than 60% and 40%, respectively. | With a stock market value of nearly $3tn, Microsoft is the world’s largest public company. Shares in the firm have increased by more than 30% over the past year – an impressive rise, although less than the rallies of Amazon and Google, whose stocks have risen by more than 60% and 40%, respectively. |
| Revenue at Microsoft increased 17% to $61.86bn during the first three months of 2024, the third quarter of its financial year, surpassing analyst expectations of some $60.88bn. Earnings per share increased 20% to $2.94, ahead of the expected $2.83. | Revenue at Microsoft increased 17% to $61.86bn during the first three months of 2024, the third quarter of its financial year, surpassing analyst expectations of some $60.88bn. Earnings per share increased 20% to $2.94, ahead of the expected $2.83. |
| With a multibillion-dollar investment in the ChatGPT developer OpenAI, Microsoft has sought to position itself at the heart of AI’s rise – and the destination for the industry’s top talent. In March, the company announced it had hired a co-founder of Google’s Deepmind AI subsidiary, Mustafa Suleyman, as well as a co-founder of $4bn startup Inflection AI and several of its employees. | With a multibillion-dollar investment in the ChatGPT developer OpenAI, Microsoft has sought to position itself at the heart of AI’s rise – and the destination for the industry’s top talent. In March, the company announced it had hired a co-founder of Google’s Deepmind AI subsidiary, Mustafa Suleyman, as well as a co-founder of $4bn startup Inflection AI and several of its employees. |
| In November, after OpenAI’s board ousted its co-founder and chief executive, Sam Altman, he briefly said he would decamp to Seattle and join Microsoft in a major coup for Nadella. The majority of OpenAI’s employees said they would join Altman, which would effectively obliterate the company. Altman was reinstated as chief executive days later. | |
| Microsoft is now trying to monetize its dominance in this space. The company reported in the final months of 2023 that AI contributed 6% of the revenue growth within its powerhouse Azure cloud computing division; up from 3% the previous quarter, according to Yahoo Finance. | Microsoft is now trying to monetize its dominance in this space. The company reported in the final months of 2023 that AI contributed 6% of the revenue growth within its powerhouse Azure cloud computing division; up from 3% the previous quarter, according to Yahoo Finance. |
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| It has been signing a series of high-profile AI deals. Two days before this week’s earnings report, Microsoft announced that Coca-Cola had signed a five-year, $1.1bn contract with Azure for AI and cloud computing services. Last month, it announced a partnership with AI startup Mistral to offer access to the French company’s models Azure. | It has been signing a series of high-profile AI deals. Two days before this week’s earnings report, Microsoft announced that Coca-Cola had signed a five-year, $1.1bn contract with Azure for AI and cloud computing services. Last month, it announced a partnership with AI startup Mistral to offer access to the French company’s models Azure. |