Wall Street Ends Sharply Higher, Lifted by Soaring Microsoft
Azure’s fastest growth since 2022 helped Microsoft beat revenue and earnings estimates, easing investor worries that its AI spending was too aggressive.
- On Thursday, Microsoft shares leaped 15.2% after reporting $90 billion in quarterly revenue, an 18% increase year-over-year. Azure posted 43% revenue growth, easily topping Wall Street expectations of roughly 40%.
- Microsoft invested $41 billion in capital expenditures during the quarter, a 70% increase from a year earlier, to expand AI data centers. Investors appeared convinced these infrastructure investments are already generating enough revenue to justify the unprecedented spending.
- Chief Financial Officer Amy Hood told investors that efficiency improvements are translating directly into financial results. "When we can make efficiency gains, they are quickly monetized in quarter," Hood said during the earnings call.
- Meta Platforms shares fell 8.9% after raising capital spending forecasts, contrasting sharply with Microsoft, which refrained from increasing its capex projections. This disciplined approach reassured investors the company can remain competitive without sacrificing financial stability.
- The Philadelphia Semiconductor Index soared 8% as chip companies clawed back recent losses. Microsoft emphasized that nearly 90% of Microsoft Cloud revenue comes from customers outside the largest frontier AI model developers, indicating broad enterprise adoption.
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Microsoft Just Had Its Best Day Since 2008
A monster day for Microsoft following signals that its big spending on AI is translating into profits led a powerful rebound on Wall Street on Thursday, while AI stocks regained some of their sharp recent losses. The S&P 500 rallied 121.48 points, or 1.7%, to 7,437.63...
The Billings Gazette
Wall Street ends sharply higher, lifted by soaring Microsoft
Wall Street ended sharply higher Thursday, with chip stocks jumping and Microsoft logging its biggest daily percentage gain in 18 years after it gave a stellar forecast that eased fears about massive spending on artificial intelligence infrastructure.
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