MSFT: Microsoft Stock Pops 7% as Tech Titan Posts AI-Powered Double Beat, Bright Outlook

Both top and bottom line for the company’s fiscal third quarter came in above estimates. AI was a major driver.

🚀 Microsoft Soars on Strong Earnings

• Shares of Microsoft MSFT surged 7% in after-hours trading Wednesday after the company reported a solid double beat for its fiscal third quarter — and served up a guidance outlook that gave bulls even more reasons to charge higher.
• Earnings came in at $3.46 per share, comfortably ahead of the $3.22 expected by analysts. Revenue topped forecasts as well, landing at $70.1 billion versus the $68.4 billion consensus. That’s up from $61.9 billion in the same quarter last year — a jump of nearly 13%.

🌩️ Azure Accelerates, Cloud Remains King

• As usual, the engine under the hood was cloud — and more specifically, Azure. Overall cloud revenue grew 20% year-over-year to $42.4 billion, while Azure clocked in at 33% growth, a noticeable acceleration from the 31% growth seen the previous quarter. For the fourth quarter, the company expects Azure to grow 34%, flexing continued momentum in one of tech’s most scrutinized battlegrounds.
• Capex, a closely watched metric to gauge investment appetite, also made headlines: Microsoft spent $16.7 billion in the quarter, a touch above expectations and up sharply from $11 billion a year ago. But investors didn’t flinch.

💰 AI Spending High, Margins Still Intact

• CFO Amy Hood assured Wall Street that despite heavy AI infrastructure spending, full-year operating margins will still be up slightly year-over-year — the kind of financial finesse markets love.
• “The demand for AI is translating into real business,” Hood said on the earnings call. “And we’re committed to meeting it while maintaining disciplined financial performance.”