Microsoft forecasts strong growth for Azure cloud business, shares surge 7%

Written by Deborah Mary Sophia, Stephen Nils and Editia Sony

(Reuters)-Microsoft on Wednesday is stronger than the expected semester growth of its business in the field of cloud computing after it results from the last quarter explosion, and the investors calm into an uncertain economy and raised its shares by 7 % after hours.

Microsoft results, which follow similar results from Google last week, may reduce concerns about the potential slowdown in the demand for artificial intelligence, after some analysts have indicated the rent of the Microsoft Data Center as a sign of excess capacity.

Investors were also concerned about the repercussions sweeping American definitions that drive companies to curb spending, but strong ads sales on identification platforms suggested not to happen yet.

It has placed Microsoft’s shares in the track to add more than 200 billion dollars to its value.

Microsoft said that the revenues in its Azure Cloud section increased by 33 % in the third quarter ending on March 31, as it exceeded 29.7 % estimates, according to Visible Alpha. Artificial intelligence contributed 16 percentage points to growth, up from 13 points in the previous quarter.

The company also expected cloud computers revenue to grow by 34 % to 35 % based on a fixed currency for the fourth fiscal quarter to between 28.75 billion dollars and $ 29.05 billion, much higher than analysts estimates, according to data from the visible alpha.

The growth of commercial reservations – which reflects new infrastructure contracts and software contracts signed by business customers – increased by 18 % in the third financial quarter, partially driven by the new Azure contract with Cathgpt Creator Openai. Microsoft refused to comment on the size of the deal or the role it played in the growth of Azure sales in general.

However, Emmy Hood, the financial manager of Microsoft, told investors at a phone conference that the contribution of artificial intelligence in the field of cloud computing was compatible with the company’s expectations, while “the real performance in Azur was this quarter in our unavoidable business.”

Hood said: “So the only real upper trend we saw on the side of Amnesty International is that we were able to make the offer early to a number of customers,” Hood said.

The results of AZURE in the company came after a number of Wall Street analysts reduced expectations, as research reports stated that Microsoft had completed some lease contracts in the data center.

CEO Satia Nadella said at a phone conference that Microsoft has a long history of constantly modifying the data center plans, but only in the last chapters, analysts began to closely check these moves.

“The numbers were skeptical of going, giving them the room to overcome a very heavy. The rhythm was not big if we did not have all these problems,” said Dan Morgan, chief director of the portfolio in Swinovos Trust, in reference to the induction uncertainty.