Friday, December 6, 2024
HomeSoftwareAI Helps Boost Microsoft Cloud Revenues By 33 Percent

AI Helps Boost Microsoft Cloud Revenues By 33 Percent

Published on

spot_img


Microsoft says Azure cloud revenues up 33 percent for September quarter as capital expenditures surge to keep pace with AI demands

Microsoft’s revenues rose 16 percent to $65.6 billion (£50.1bn) in its fiscal first quarter ended in September, beating analysts’ estimates, as the company sought to show that its heavy investments into artificial intelligence (AI) are paying off.

Under a new structure for financial reporting, the firm said revenue from Azure and other cloud services grew by 33 percent, similar to gains posted by competitor Google a day earlier.

Google said its cloud business saw a nearly 35 percent year-on-year growth in cloud revenues for the quarter to $11.35bn, beating analysts’ estimates.

Microsoft’s shares rose in after-hours trading.

Image credit: Turag Photography/Unsplash

AI transformation

“AI-driven transformation is changing work, work artifacts, and workflow across every role, function, and business process,” chief executive Satya Nadella said in a statement.

“We are expanding our opportunity and winning new customers as we help them apply our AI platforms and tools to drive new growth and operating leverage.”

The firm said capital expenditures rose 5.3 percent to $20bn for the quarter, compared to $19bn in the previous quarter, as it invests billions into data centre expansion.

Big tech companies including Microsoft, Google, Meta, Amazon and others are placing a huge bet on generative AI, an expensive technology that carries risks including rising costs per customer.

Sharply rising energy demands are another factor, one Microsoft has been seeking to allay with an effort to restart the Three Mile Island nuclear power plant that was the site of the US’ biggest nuclear accident in 1979.

AI costs

Google and Amazon have also signed nuclear deals to secure power for their data centres.

Investor excitement over the technology has led to huge stock-market gains for those companies, but Microsoft has not been one of the biggest beneficiaries.

Its shares have risen around 16 percent this year, compared to 68 percent for Meta and 28 percent for Amazon, while AI chip maker Nvidia has seen its shares rise nearly 190 percent this year.

Investors have shown increasing caution around the biggest tech companies, Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla, which represent about one-fifth of the S&P 500 but have collectively trailed the market for the past three months.



Source link

Latest articles

Something Has Gone Seriously Wrong With Cybertruck Production

A different kind of Cyber-stuck.Batteries Not IncludedLast week, Tesla told workers on its...

Meta To Spend $10 Billion On Largest Data Centre

Facebook parent confirms its 23rd data centre in the US will be located...

Musk’s Neuralink Cited For ‘Objectionable Conditions

Federal regulator reportedly cites animal lab at Elon Musk’s Neuralink for “objectionable conditions...

Google’s latest free update is a Christmas present to Pixel owners

This holiday season, Google is spreading cheer with its December Pixel Drop, delivering...

More like this

Something Has Gone Seriously Wrong With Cybertruck Production

A different kind of Cyber-stuck.Batteries Not IncludedLast week, Tesla told workers on its...

Meta To Spend $10 Billion On Largest Data Centre

Facebook parent confirms its 23rd data centre in the US will be located...

Musk’s Neuralink Cited For ‘Objectionable Conditions

Federal regulator reportedly cites animal lab at Elon Musk’s Neuralink for “objectionable conditions...