Microsoft has beaten Wall Street expectations again. This marks the fourth quarter in a row that the company has done so. The reason? Its growing work in artificial intelligence (AI).
The tech giant reported $70.07 billion in revenue. That is much higher than the $68.42 billion that analysts had predicted. Its earnings per share reached $3.46, beating the $3.22 estimate. The news came out after markets closed on Wednesday. Soon after, Microsoft’s stock jumped more than 5% in after-hours trading.
AI and Cloud Are Leading the Way
CEO Satya Nadella says AI and cloud services are now the heart of Microsoft’s growth. The company plans to spend $80 billion on AI in this fiscal year. A big part of this goes to OpenAI and other partners. Microsoft believes AI can help people work faster and better.
Nadella added that AI helps cut costs and boosts how much companies can get done. Brad Smith, the company’s president, went further. He said AI is as important to the world as electricity once was.
AI Is Changing Software
Microsoft is using AI to write code. Nadella said 30% of Microsoft’s code now comes from AI tools. Chief Technology Officer Kevin Scott said that number could go up to 95% in five years.
This shows how fast AI is growing. It’s not just a trend. It’s shaping the way companies work. It helps developers do more in less time. And it makes products smarter.
Cloud Business Keeps Growing
Microsoft’s cloud service, Azure, is also doing well. This quarter, it grew by 33% compared to last year. That was better than expected.
To meet growing demand, Microsoft is building more data centers. It plans to grow its European centers by 40% in two years. Nadella said more businesses are moving to the cloud. Big names like Coca-Cola and Abercrombie & Fitch are among them.
Last quarter, Microsoft saw a 12% jump in revenue. Its AI business grew 175% year over year. These numbers show that AI and cloud services are now core parts of its business.
Staying Strong Despite Global Risks
Even with global issues, Microsoft is staying strong. Other tech firms like Apple, Amazon, and Meta face more risk. Trade problems and tariffs have hit them harder.
Microsoft seems better protected. Its cloud systems are not as exposed to trade wars. Still, there are risks. Rising tension between the U.S. and the EU is one.
Brad Smith warned that Microsoft would fight any move to close its cloud centers in Europe. He said the company would use all legal tools if needed.
AI Rivals and Market Moves
Earlier this year, a new AI platform called DeepSeek entered the market. It caused a small drop in Microsoft’s stock. But Microsoft acted fast. It took ideas from DeepSeek and used them in its own tools.
This helped the company bounce back. It also showed how quick thinking keeps Microsoft ahead. The firm is not just reacting. It is leading in AI and cloud tech.
Since January, Microsoft’s stock had fallen 7%. That was due to market worries and global issues. But this quarter’s good news shows it can still grow.
Microsoft plans to keep building on its AI work. With big investments and strong cloud growth, the future looks bright. It wants to make AI a tool for everyone, not just for tech experts.
By staying focused and flexible, Microsoft is setting the pace. Its mix of smart choices and strong results keeps it ahead.
As other firms struggle with rules and global politics, Microsoft is showing how to grow. It is ready for what comes next.