Microsoft will skyrocket above its 4T dollar market capitalization after blowout revenue
Stocks Microsoft Corp. (MSFT) After the star’s revenue report, it jumped nearly 5% on Thursday, pushing its market capitalization to above $4 trillion for the first time. Microsoft is just the second company to reach that milestone. Nvidia Corp. (NVDA)the threshold was exceeded three weeks ago.
The profits of the software giant helped drive major ETFs to new heights. Vanguard S&P 500 ETF (VOO)holds a 7% allocation to Microsoft. Investco QQQ Trust (QQQ)Microsoft represents 9% of its portfolio, both trading at record highs.
Microsoft for the fourth quarter It has been reported Earnings per share was $3.65, while Wall Street estimates were $3.37. Revenue was $76.4 billion, up 3.5% from the previous year, showing an increase of 18%.
It is at the heart of the company’s growth story artificial intelligence. Microsoft continues to embed AI in its own software products, providing cloud-based AI infrastructure to other companies through Azure. This has emerged as an important driver of growth. According to CEO Satya Nadella, Azure alone has generated more than $75 billion in revenue over the past year, up 34% from the previous year.
“Cloud and AI are the driving forces of business transformation across all industries and sectors,” Nadella said. “We are innovating throughout Tech Stack to help our customers adapt and grow in this new era.”
The broader Azure and other cloud services category has increased by 39%. This is the fastest pace since 2022. The demand is very strong and Microsoft is struggling to keep up. Despite the increased capacity, Nadella admitted that supply remains restrained.
Even Openai, a well-known Microsoft AI partner, holds significant stocks, but Microsoft’s infrastructure bottlenecks have forced them to resort to other cloud providers like Oracle to meet their computing needs.
To close the gap, Microsoft plans to spend an incredible $30 billion on capital expenditures this quarter alone. So far, investors appear to support an aggressive investment strategy, betting that demand for AI justifies spending.
The development is also on track for Nvidia, which chips most of the AI infrastructure that supports Microsoft’s growth.
As the AI race intensifies, ETF investors continue to earn profits. In particular, investors with heavy exposure to the huge ones leading the claims.
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