Voles's quarterly results "showed early signs that the company's investments in generative AI were beginning to bolster sales, most notably reversing what had been slowing growth of the company's important cloud computing product.
The company had $56.5 billion in sales in the three months that ended in September, up 13 per cent from a year earlier. Profit hit $22.3 billion, up 27 per cent. The results beat analyst expectations and Microsoft's own estimates.
Microsoft had told investors that A.I. wouldn't start producing meaningful results until after the start of 2024, when more products became widely available.
The company and its competitors are racing to put generative A.I. into nearly every product they offer. Microsoft is seen by many companies as a leading A.I. provider, thanks to its partnership with — and $13 billion investment in — the start-up OpenAI, which introduced the chatbot ChatGPT almost a year ago.
Microsoft's flagship cloud computing product, Azure, grew 29 per cent, up from 26 per cent in the previous quarter. About three percentage points of Azure's growth came from generative A.I. products, including the access Microsoft provides to OpenAI's GPT-4 language model, more than the company had told investors to expect.
Volish CEO Satya Nadella told investors more than 18,000 organisations were using Microsoft's Azure OpenAI services and that included punters who had not used Azure before.
"Azure again took share as organizations took their workloads to our cloud. The company said that sales could increase as much as 8.7 per cent in the current quarter, exceeding investor expectations, and that it was investing in building data centers to support the demand for A.I. and cloud computing," he said.
Microsoft's personal computing business grew just three per cent, to $13.7 billion, reflecting how consumer behaviors have shifted since the laptop-buying binges of the pandemic.
The revenue of the Windows operating system installed on new computers was up four per cent. Gaming provided a consumer bright spot, with Xbox content and services up 13%.
Next month Microsoft integrates its Copilot AI product into its Excel/Word/Teams "productivity suite" — but Microsoft CEO Satya Nadella said that 40 per cent of Fortune 100 companies have already been testing the feature during its "limited preview", and "so far, so good."