Microsoft and Meta report strong quarterly earnings

CALIFORNIA

Technology giant Microsoft’s profit soared above expectations in the recently ended quarter, driven by its cloud computing and artificial intelligence (AI) units.

Microsoft reported profit of $27.2 billion on revenue of $76.4 billion, some $29.9 billion of which was brought in by its Intelligent Cloud business.

Microsoft's Azure cloud computing offerings brought in more than $75 billion for the company's fiscal year, which ended on June 30, in an increase of 34 percent from the prior year.

"This was a slam-dunk quarter for Microsoft with cloud and AI driving significant business transformation across every sector and industry," Wedbush Securities analyst Dan Ives said in a note to investors.

"The company continues to capitalize on the AI Revolution."

Microsoft was one of the first tech giants to double down on artificial intelligence when the launch of ChatGPT in 2022 rocked the tech industry.

Like its rivals, it has spent massively on building the infrastructure necessary to power the AI revolution, with analysts keeping a close eye on the return on investment.

Meta also reported robust second-quarter financial results, with revenue jumping 22 percent year-over-year to $47.5 billion as the social media giant continues investing heavily in artificial intelligence.

Meta posted a net profit of $18.3 billion, compared with $13.5 billion in the same period last year. The results exceeded Wall Street expectations as advertising revenue climbed a stellar 21 percent to $46.6 billion.

The company significantly increased its capital expenditures to $17 billion in the quarter, primarily for AI infrastructure investments. Meta projects total 2025 capital spending between $66 billion and $72 billion.