Microsoft's third-quarter earnings results exceeded Wall Street's expectations due to a powerful cloud computing business, the company revealed on Tuesday.
The tech giant made a profit of $2.99 per share from $56.5 billion in sales during the quarter ending September 30.
Analysts predicted that Microsoft's earnings would reach $2.65 per share from sales of $54.5 billion. Compared to the same period last year, Microsoft's earnings increased by 27%, while sales grew by 13%.
Microsoft 365 Copilot received a special highlight in the comments by Microsoft CEO Satya Nadella that followed the release.
"We are rapidly infusing AI across every layer of the tech stack and for every role and business process to drive productivity gains for our customers," Nadella said in his statement.
Google Sees Slow Performance in Its Cloud Business
While Microsoft had its moment the previous quarter, Google parent Alphabet experienced its slowest growth in the last three years with its cloud business.
Global economic concerns have led to reduced corporate spending on cloud services and AI tools, causing Google Cloud's third-quarter growth to decline to 22.5%.
In the third quarter of 2023, Google Cloud's revenue reached $8.41 billion after registering the slowest growth since the start of 2021. This fell short of Wall Street's $8.62 billion revenue expectation.
The division reported an operating income of $266 million, a significant improvement from a $440 million operating loss the previous year.
During a recent conference call, CFO Ruth Porat attributed the slower Q3 growth to "customer optimization efforts" without providing further details.
In contrast, Microsoft's Intelligent Cloud unit, including Azure, exceeded expectations with $24.3 billion in revenue, showing a 29% increase, surpassing the 26.2% growth predicted by Visible Alpha.