Nvidia became the first ever company to hit $4 trillion in market value (and just earlier this month), and now Microsoft is joining the AI chipmaker in the exclusive $4 trillion club.
Microsoft reported better-than-expected earnings on Wednesday, causing shares to jump 8%, and elevating the company’s market capitalization to around $4.1 trillion. As of the time of writing, Microsoft sustained the growth with a market value of $4.03 trillion, with shares up about 5% on Thursday morning.
Related: Microsoft Executive Says Using AI Has Saved $500 Million in Productivity Costs, as the Company Conducts Mass Layoffs
Both Microsoft and fellow AI giant Meta added a combined $440 billion in market value late Wednesday, with Meta’s earnings driving a 9% surge in its market capitalization in after-hours trading. Both companies surpassed analyst expectations with strong financial results on Wednesday, revealing that Big Tech’s AI investments are paying off.
Microsoft’s Chief Financial Officer Amy Hood told investors in an earnings call on Wednesday that the company planned to spend a record $30 billion for the current quarter on AI expenses like data centers, more than the $24.23 billion analysts expected.
Microsoft’s rally was due to the strength of its latest earnings report for the quarter ending June 30, which the tech giant disclosed on Wednesday after the bell. In the report, Microsoft revealed quarterly revenue of $76.4 billion, up 18% from the same period last year, marking the company’s fastest revenue growth in three years.
Related: Microsoft’s CEO Says the Company’s Mass Layoffs, Despite Financial Success, Are ‘Weighing Heavily on Me’ in an Internal Memo
Microsoft CEO Satya Nadella. Photo by Stephen Brashear/Getty Images
Analysts were expecting $74.62 billion in Azure revenue, causing Microsoft’s report to exceed expectations.
The growth was largely driven by Microsoft’s Azure cloud computing division, which provides computing power and storage for AI. Microsoft CEO Satya Nadella revealed Azure revenue for the first time in the report, noting that Azure “surpassed $75 billion in revenue, up 34%, driven by growth across all workloads.”
“Cloud and AI is the driving force of business transformation across every industry and sector,” Nadella stated in the report.
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