Key Points
Microsoft (NASDAQ: MSFT) reported a strong fourth-quarter financial result for its fiscal year 2026 on July 29, ending June 30. The company’s cloud division, led by Microsoft Azure, achieved a 43% year-over-year sales growth, an increase from 40% in the previous quarter. Additionally, Microsoft closed the fiscal year with a $678 billion cloud backlog, up 84% year-over-year.
CEO Satya Nadella highlighted significant performance improvements through the company’s custom AI chips, which deliver 40% better performance per watt compared to external suppliers like Nvidia (NASDAQ: NVDA). This strategy is expected to reduce operational costs while increasing margins in the cloud segment, positioning Microsoft as a potential leader in the expanding AI infrastructure market, projected to reach $1 trillion within three years. Following these updates, Microsoft shares have risen 5% year-to-date, while the S&P 500 has increased by 12%.
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