#Microsoft #Demand
After Microsoft (MSFT) reported fiscal first-quarter earnings that beat analyst estimates, CFO Amy Hood told investors on the company’s earnings call that demand for artificial intelligence (AI) “remains higher than our available capacity.”
Microsoft’s Intelligent Cloud segment, which includes the Azure cloud computing platform, led growth in the quarter. This sector’s revenues jumped 20% year-on-year to $24.09 billion as demand for artificial intelligence rose, although analysts were expecting more.
The fastest growing business in Microsoft’s history
CEO Satya Nadella said usage of the Azure Open AI service has more than doubled over the past six months, with Microsoft’s AI business on track to reach an annual revenue run rate of $10 billion in the second quarter, making it “the fastest growing business in the world.” In our company. History for reaching this milestone.”
“We are seeing AI driving fundamental change in the business applications market as customers shift from legacy applications to AI-first business processes,” Nadella said.
Cloud growth may slow before rebounding in the second half of 2025
Microsoft expects intelligent cloud growth to slow to between 18% and 20% in the second quarter, with Azure growth expected to slow to between 31% and 32%, before accelerating again in the back half of the fiscal year, Hood said.
Microsoft shares fell about 3% in extended trading after the earnings call. They’re up 15% for 2024 through Wednesday’s close.
#Microsoft #Demand
