Microsoft stock surges 8.5%, boosted by strong cloud business performance in various markets

Microsoft shares jumped after the company said fiscal third-quarter net profit went up nearly 9 per cent on an annual basis, driven by strong cloud business in different markets.

The company’s net profit jumped to $18.3 billion in the three months to the end of March, from the same period a year earlier, Microsoft said in a statement on Tuesday.

Revenue during the January-March period jumped 7 per cent to $52.9 billion, exceeding analysts’ expectations of $51.02 billion.

The company’s stock, which has gained 15 per cent since the start of this year, surged 8.5 per cent in after-hours trading on Tuesday. The share price was $275.42 at market close, giving Microsoft a market value of $2.05 trillion.

Revenue in Microsoft’s intelligent cloud division, which includes Azure public cloud, increased 16 per cent annually to $22.1 billion.

Sales from Azure and other cloud services, which Microsoft does not report in dollars, grew by about 27 per cent.

“The world’s most advanced AI models are coming together with the world’s most universal user interface – natural language – to create a new era of computing,” said Satya Nadella, Microsoft’s chairman and chief executive.

“Across the Microsoft cloud, we are the platform of choice to help customers get the most value out of their digital spend and innovate for this next generation of AI.”

Since 2016, Microsoft has committed to building Azure into an AI supercomputer.

Last quarter diluted earnings increased 10 per cent to $2.45 a share, compared to the $2.23 a share expected by analysts, Refinitiv reported.

Operating income surged 10 per cent to $22.4 billion in the previous quarter compared to the prior year period.

In January, Microsoft announced it was laying off 10,000 of its 221,000 employees to cut costs.