Microsoft says quarterly profits up 18% as it weathers tech sector
turbulence with cloud growth
[May 01, 2025]
REDMOND, Wash. (AP) — Microsoft's cloud computing and artificial
intelligence business helped deliver $70.1 billion in sales and boosted
profits by 18% for the January-March quarter, a dose of relief for
investors during a turbulent time for the tech sector and U.S. economy.
The company reported quarterly net income of $25.8 billion, or $3.46 per
share, beating Wall Street expectations for earnings of $3.22 a share.
The Redmond, Washington-based software maker posted revenue of $70.1
billion in the period, its third fiscal quarter, up 13% from the same
period a year ago and also beating Wall Street expectations. Analysts
polled by FactSet expected Microsoft to post revenue of $68.44 billion
for the quarter.
Microsoft CEO Satya Nadella credited cloud growth for its strong
quarter. The company's cloud unit posted revenue of $26.8 billion,
compared with expectations of $26.17 billion.
"Cloud and AI are the essential inputs for every business to expand
output, reduce costs, and accelerate growth,” Nadella said in a
statement.
The company also saw a 6% increase in revenue in its personal computing
unit, which includes its laptop business and Xbox services.
Nadella noted on a call with investors that demand for cloud and
artificial intelligence remained strong. He said Microsoft is constantly
tweaking its investments based on efficiency improvements in computing
systems and what kind of services customers want.
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 “We just want to make sure we are
accounting for the latest and greatest information,” he said.
Microsoft is among a group of the tech industry’s bellwether
companies that have been through a period of uncertainty and turmoil
since President Donald Trump returned to the White House, with a
see-sawing of stocks that has eviscerated trillions of dollars in
shareholder wealth amid an onslaught of tariffs and other actions.
Microsoft’s stock price has dropped nearly 8% since Trump's
inauguration in January, to about $395 at the close of markets
Wednesday. But investors appeared pleased moments later after
Microsoft released its earnings report, sending stocks up more than
6% in after-hours trading.
Revenue from Microsoft's cloud computing business segment grew 21%,
to $26.8 billion, also beating Wall Street projections.
The company felt more tariff uncertainty in its personal computing
business, which is centered around its Windows operating system and
the fees it collects from computer makers that put it on the
hardware they sell. Revenue from that business was $13.4 billion for
the quarter, up 6% from the first three months of last year.
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