Microsoft (MSFT.O) on Wednesday forecast a record $30 billion in capital expenditures for the current fiscal first quarter, after booming sales of its Azure cloud computing unit showed growing returns from its big investments in artificial intelligence.
Shares of the software company jumped 9% in extended trading after the company said Azure sales topped $75 billion annually, the first time the company has disclosed that figure, beating expectations of $74.62 billion.
Microsoft outspends rivals in AI spending. Google is expected to spend $85 billion, Meta forecasts revenue growth with slightly higher costs. The three tech giants’ combined capital spending will hit $330 billion this year. Microsoft and Meta’s results add $500 billion to AI stocks.
"I'm very pleased that the spending we're doing is directly tied to the contracts we've signed, the transactions we've booked that we need to close," Microsoft CFO Amy Hood said on a conference call with investors.
While Microsoft’s cloud business still lags Amazon Web Services (AMZN.O) — which brought in $107.56 billion in revenue in its most recent fiscal year — investors say Microsoft’s new revenue numbers show that investments are translating into increased sales.
"The fact that Microsoft released that number really helps justify the huge investment," said Dave Wagner, portfolio manager at Aptus Capital Advisors, who holds Microsoft shares.
Rival Alphabet’s (GOOGL.O) results last week also showed AI spending is rising, and profits are rising as well, as it beat revenue estimates and raised its spending forecast by $10 billion.
Microsoft said Azure revenue grew 39% in the June quarter, beating analysts' average estimate of 34.75%, according to Visible Alpha. The company expects 37% growth for the current quarter, beating analysts' estimates of 33.5%.
Microsoft said the spending is critical to overcoming supply constraints that have hampered its ability to meet surging AI demand. The estimated $30 billion in capital expenditures for the fiscal first quarter beat analysts’ expectations of $23.75 billion.
In the just-ended fiscal fourth quarter, capital spending rose 27% to $24.2 billion, compared with estimates of $23.08 billion.
Microsoft also said its AI tool Copilot has surpassed 100 million monthly active users, the first time the company has provided that figure. Google has announced that its rival Gemini has 450 million active users.
Microsoft's total revenue rose 18% to $76.4 billion in the April-June period, its fourth fiscal quarter. Analysts on average expected $73.81 billion.
Source: https://baonghean.vn/microsoft-dau-tu-ky-luc-30-ty-usd-vao-ai-doanh-so-azure-bung-no-10303574.html
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