Core Viewpoint - Microsoft is committed to ongoing investments in capital expenditures, particularly in cloud and AI, to maintain its leadership in these sectors and drive revenue growth [1][2]. Group 1: Revenue Growth - Microsoft's overall revenue increased by 13% year over year, with the Intelligent Cloud business leading this growth at 21% [2]. - The Productivity and Business Processes segment grew by 10%, while More Personal Computing saw a 6% increase [2]. Group 2: Cloud and AI Strategy - The company emphasizes that cloud and AI are critical for businesses to enhance output, reduce costs, and accelerate growth [3]. - Microsoft opened data centers in 10 countries across four continents during the recent quarter, indicating a significant expansion of its infrastructure [3]. Group 3: AI Innovations - Microsoft is launching AI agents tailored for various roles and business processes, including a Sales Agent and a Customer Service Agent [4]. - In the last quarter, customers created over 1 million custom agents across SharePoint and Copilot Studio, marking a 130% increase quarter over quarter [4]. Group 4: Future Expectations - Microsoft anticipates its Intelligent Cloud business will achieve revenue growth of 20% to 22% in constant currency for the current quarter [5]. - The company acknowledges potential AI capacity constraints beyond June due to demand outpacing the planned data center capacity [6].

Core Viewpoint - The article emphasizes the importance of quantitative methods in identifying undervalued stocks across various industries, suggesting that numerical data often provides a clearer picture of a company's potential than narrative descriptions [1]. Group 1 - The company employs backtested quantitative methods to search for undervalued stocks of any size [1]. - The analyst believes that numbers are more significant than stories in assessing a company's prospects [1]. - The investment experience dates back to 2013, supplemented by extensive reading of stock market literature [1].

Microsoft CEO Satya Nadella speaks during an event commemorating the 50th anniversary of the company at Microsoft headquarters in Redmond, Washington, on April 4, 2025. Microsoft Corp., determined to hold its ground in artificial intelligence, will soon let consumers tailor the Copilot digital assistant to their own needs. President Trump's tariffs have dominated global news headlines for weeks. During Microsoft's earnings call with investors on Wednesday, though, tariffs came up only once, during prepared ...

Microsoft customers could encounter service disruptions when using AI services due to demand outpacing the company's ability to bring data centers online, an executive warned during the company's earnings call Microsoft's EVP and CFO Amy Hood said during the company's fiscal 2025 third-quarter earnings call Wednesday the company may face AI capacity constraints as early as June because demand is higher than its data centers can handle. "We had hoped to be in balance by the end of Q4 but we did see some incr ...

Group 1: Earnings Performance - Microsoft reported quarterly earnings of $3.46 per share, exceeding the Zacks Consensus Estimate of $3.20 per share, and up from $2.94 per share a year ago, representing an earnings surprise of 8.13% [1] - The company posted revenues of $70.07 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.46%, compared to $61.86 billion in the same quarter last year [2] - Over the last four quarters, Microsoft has consistently surpassed consensus EPS and revenue estimates [2] Group 2: Stock Performance and Outlook - Microsoft shares have declined approximately 6.5% since the beginning of the year, while the S&P 500 has seen a decline of 5.5% [3] - The future performance of Microsoft’s stock will largely depend on management's commentary during the earnings call and the outlook for earnings estimates [4][6] - The current consensus EPS estimate for the upcoming quarter is $3.28 on revenues of $72.03 billion, and for the current fiscal year, it is $13.03 on revenues of $275.39 billion [7] Group 3: Industry Context - The Computer - Software industry, to which Microsoft belongs, is currently ranked in the top 31% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

As Microsoft reported third-quarter earnings on Wednesday, chief financial officer Amy Hood's quarterly internal message to employees reflected on the company's 50th anniversary and touted recent AI agents as an example of what's to come. Hood sends the emails quarterly when Microsoft reports earnings, and they mostly rehash the public financial reports."Celebrating our 50th anniversary earlier this month was a significant milestone, and I really enjoyed reminiscing about pivotal (or just funny) moments fr ...

Financial Data and Key Metrics Changes - Revenue for the quarter was $70.1 billion, up 13% in constant currency [29] - Gross margin dollars increased 11% in constant currency, while operating income increased 16% in constant currency [29] - Earnings per share was $3.46, an increase of 18% in constant currency [29] Business Line Data and Key Metrics Changes - Microsoft Cloud revenue was $42.4 billion, growing 20% in constant currency [32] - Productivity and Business Processes revenue was $29.9 billion, growing 10% in constant currency, driven by LinkedIn and Microsoft 365 [33] - Intelligent Cloud segment revenue was $26.8 billion, growing 21% in constant currency, with Azure revenue growing 33% [37] - More Personal Computing revenue was $13.4 billion, growing 6% in constant currency, with gaming revenue increasing 56% [39][40] Market Data and Key Metrics Changes - Commercial bookings increased 18% in constant currency, significantly ahead of expectations [30] - Commercial remaining performance obligation increased to $315 billion, up 34% in constant currency [30] - LinkedIn membership grew at double digits year over year, with time spent on the platform up 36% [22] Company Strategy and Development Direction - The company continues to focus on cloud and AI as essential drivers for business growth, with significant investments in data center capacity and AI infrastructure [6][7] - Microsoft aims to optimize efficiencies across all layers of its operations, from data center design to model optimization [7] - The company is expanding its AI capabilities and integrating them into various products, including Microsoft 365 and Dynamics 365 [15][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for cloud services and AI, despite potential economic uncertainties [81] - The company anticipates continued growth in its cloud and AI segments, with a focus on helping customers navigate economic challenges [82] - Management highlighted the importance of maintaining a balanced approach to data center investments and workload growth [60][65] Other Important Information - Capital expenditures for the quarter were $21.4 billion, slightly lower than expected [41] - Free cash flow was $20.3 billion, driven by strong cloud billings and collections [42] - The company returned $9.7 billion to shareholders through dividends and share repurchases, an increase of 15% year over year [42] Q&A Session Summary Question: Data center commitments and AI demand - Management clarified that adjustments to data center commitments are ongoing and are based on future workload growth [60][61] - The company is currently short on power in specific locations, impacting its ability to build or lease at desired rates [63][67] Question: Accelerating demand for cloud migrations - Management noted three key trends driving cloud migrations: classic migrations, data growth, and cloud-native growth [72][75] Question: Stability and sustainability in a potential recession - Management emphasized a focus on helping customers during economic turbulence, leveraging cloud efficiencies to mitigate impacts [81][82] Question: Azure growth and non-AI services - The majority of Azure's outperformance was attributed to non-AI services, with strong demand from enterprise customers [86][88]

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Microsoft reported it beat analysts' estimates during its third-quarter earnings call on Wednesday. "Cloud and AI are the essential inputs for every business to expand output, reduce costs, and accelerate growth," Satya Nadella, chairman and chief executive of Microsoft, said in a press release published ahead of the Q3 call. "From AI infra and platforms to apps, we are innovating across the stack to deliver for our customers."Ahead of Microsoft's earnings call on Wednesday, analysts at Piper Sandler said ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period From to Commission File Number 001-37845 MICROSOFT CORPORATION WASHINGTON 91-1144442 (STATE OF INCORPORATION) (I.R.S. ID) ONE MICROSOFT WAY, REDMOND, WASHINGTON 98052-6399 (4 ...