Microsoft profit surges in boom

Microsoft yesterday said its profit rose 20 per cent for the January-March quarter as it tries to position itself as a leader in applying artificial intelligence technology to make workplaces more productive.

The company reported quarterly net income of US$21.93 billion, or US$2.94 per share, beating Wall Street expectations for earnings of US$2.82 a share.

The Washington-based software maker posted revenue of US$61.86 billion in the period, its third fiscal quarter, up 17 per cent from the same period a year ago. Analysts polled by FactSet expected Microsoft to post revenue of US$60.86b for the quarter.

Microsoft doesn’t spell out how much money it makes from AI products, including its flagship Copilot chatbot that can compose documents or generate images. But it has infused the technology into its main lines of business, such as cloud computing contracts and subscriptions for its email and other services.

Quarterly revenue from Microsoft’s cloud computing business segment grew to US$26.7b, up 21 per cent from last year’s January-March quarter. Revenue from productivity services — such as its Office line of products — rose 12 per cent to US$19.6b.

Businesses pay USMicrosoft $30 per employee each month to add Copilot to a workplace subscription for its package of services that includes email and spreadsheets.

Gartner analyst Jason Wong said many of Microsoft’s customers have shown a strong interest in giving generative AI a try but don’t all have a solid plan for a use that justifies the cost. “It’s still very early,” he said.