Microsoft reported better-than-expected quarterly results, driven by its Azure cloud business.
Revenue increased 13% year over year in the fiscal third quarter, which ended on March 31, according to a statement. Net income climbed 18% to $25.8 billion from $21.9 billion, or $2.94 per share, a year earlier.

The company’s Azure revenue grew 33%, with 16 points of the growth associated with AI.
The Intelligent Cloud unit that includes Azure produced $26.75 billion in revenue, up around 21%.

Microsoft continued to invest heavily in AI infrastructure during the quarter. Capital expenditures, excluding finance leases, reached $16.75 billion, up nearly 53%. Analysts surveyed by Visible Alpha had expected $16.37 billion.

CEO Satya Nadella said earlier this year that Microsoft plans to spend $80 billion in fiscal 2025 on construction of data centers that can handle artificial intelligence workloads. That requires hefty imports from overseas, meaning costs could rise depending on where tariffs land.

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