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Microsoft is on the brink of becoming the second company in history to hit a $4-trillion (R72-trillion) market valuation, after reporting stellar quarterly earnings that exceeded Wall Street expectations and triggered a surge in after-hours trading.
The company’s shares spiked by as much as 9%, soaring above the $560 mark during extended trading in New York on Wednesday. If even part of this gain holds when markets open on Thursday, Microsoft will cross the $4-trillion threshold—joining Nvidia, which achieved the milestone earlier this month amid the global AI investment boom.
“Microsoft is getting the recognition that it deserves because it is the operating system for business,” said Kim Forrest, chief investment officer at Bokeh Capital Partners. “This quarter’s results point to an even better position for Microsoft because, like Nvidia, there appear to be no substitutes.
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The quarterly report confirmed what analysts and investors have been anticipating: Microsoft is cementing its leadership in the AI revolution that’s redefining the tech sector. Central to this surge is the Azure cloud platform, which recorded a 39% increase in sales, significantly outpacing analysts’ projections of 34%.
Chief Financial Officer Amy Hood revealed during the company’s earnings call that Microsoft expects more than $30 billion in capital expenditure for the upcoming fiscal first quarter, much of it likely earmarked for AI infrastructure. Additionally, Azure is projected to grow 37% in the first quarter, again surpassing Wall Street estimates.
The numbers have sent Wall Street bulls into overdrive. Of the 72 analysts tracking Microsoft, 65 have issued a buy rating, with only one calling a sell, per Bloomberg data. The average 12-month price target is set at $554, representing further upside potential.
Microsoft’s stock rebound in 2025 is also worth noting. After lagging its tech peers in 2024 and entering the first quarter of 2025 in the red—due to scepticism around its AI direction and Azure growth—Microsoft has staged a massive rally. Since April 8, when geopolitical trade fears rattled markets, Microsoft shares have surged nearly 45%, nearing record highs.
The company’s earnings victory underscores its position as a pillar of enterprise infrastructure, thanks to widely used tools like Word, Excel, Outlook, and Teams. But beyond office software, it’s Microsoft’s strategic bets on cloud computing and generative AI—including its partnership with OpenAI—that are now paying off in historic fashion.
As the company inches toward an unprecedented valuation, second only to Nvidia, Microsoft’s performance signals deep investor confidence in its long-term vision and relevance in an increasingly AI-driven world.
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