Microsoft soars by $140 billion in market value after the ChatGPT investor reveals AI boosted its cloud sales
- Microsoft shares rallied Wednesday after its earnings beat Wall Street's targets.
- If the gains hold up, the tech giant could end the day with another $150 billion in market value.
Microsoft stock jumped Wednesday after the tech giant revealed its AI offerings helped to boost sales of its cloud computing business over the past quarter.
The company's shares rose 7% to trade at around $295 as markets opened. If those gains holds firm to the closing bell, Microsoft would end the day having added another $140 billion to its market capitalization.
The stock-price increase was sparked by the release of Microsoft's quarterly earnings after Tuesday's closing bell.
The company reported earnings per share of $2.45 and revenue of just under $53 billion, both of which comfortably beat Wall Street's targets.
It also said that revenue from its cloud computing service Azure grew by 27% year-on-year in the first three months of 2023.
Microsoft's latest report covered a quarter in which it extended its ongoing partnership with OpenAI and launched a new version of its search engine Bing powered by the intelligent language tool ChatGPT.
In a post-earnings conference call, CEO Satya Nadella said that "investing to lead in the new AI wave" would be one of the tech giant's main business priorities, and that developments in this area were already boosting Azure's sales.
"Azure took share, as customers continue to choose our ubiquitous computing fabric – from cloud to edge, especially as every application becomes AI-powered," he told shareholders.
Nadella added that Bing now has over 100 million daily users, and has seen downloads jump since Microsoft announced it was integrating ChatGPT technology into the search engine.
Google parent Alphabet, another large cloud provider, traded flat at the opening bell after reporting strong results of its own Tuesday.
Amazon, which also has a big cloud business, climbed around 2% ahead of its own first-quarter earnings, set to be published Thursday.
Microsoft's gains came despite the UK's competition regulator blocking its $75 billion acquisition of Activision Blizzard, the videogame developer behind the hit game series "Call of Duty", early Wednesday.