Microsoft stock jumped Thursday after the tech giant crushed Wall Street's targets for its fiscal fourth quarter thanks to its cloud computing and artificial intelligence businesses.
The Redmond, Wash.-based software company late Wednesday reported earnings of $3.65 a share on sales of $76.44 billion in the quarter ended June 30. Analysts polled by FactSet had expected Microsoft to earn $3.37 a share on sales of $73.86 billion. On a year-over-year basis, Microsoft's earnings rose 24% while sales increased 18%.
Microsoft Cloud revenue rose 27% year over year in the June quarter to $46.7 billion. Azure cloud platform revenue grew 39% year over year in fiscal Q4, beating its target range of 34% to 35%.
Cloud, AI Are Main Growth Drivers
"Cloud and AI is the driving force of business transformation across every industry and sector," Chief Executive Satya Nadella said in a news release. "We're innovating across the tech stack to help customers adapt and grow in this new era, and this year, Azure surpassed $75 billion in revenue, up 34%, driven by growth across all workloads."
Microsoft's Intelligent Cloud business saw revenue increase 26% to $29.9 billion in fiscal Q4. Its Productivity and Business Processes unit posted a gain of 16% to $33.1 billion. And its More Personal Computing unit delivered a 9% increase with sales of $13.5 billion.
Based on the midpoint of its outlook, Microsoft expects September-quarter revenue of $75.25 billion, vs. the consensus estimate of $74.15 billion. Its guidance would represent a year-over-year increase of 14.7%.
Further, it expects Azure growth of 37% in constant currency in the fiscal first quarter.
On the stock market today, Microsoft stock jumped 4% to close at 533.50. Earlier in the session, it notched a record high of 555.45. Its previous all-time high was 518.29, reached on July 25.
Microsoft stock is on two IBD lists: Long-Term Leaders and Tech Leaders.
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