Microsoft share price: The world’s second most valuable company — Microsoft — saw a stellar rally in its share price during the pre-market trade, following a blockbuster earnings report. The sharp surge in Microsoft shares is set to drive its market value past the coveted $4 trillion mark, making it the second company, after Nvidia, to hit this mark.
Microsoft’s share price, which was trading 8.5% at $557.03, in early pre-market trading, valued the company at $4.14 trillion. The tech behemoth closed the session at $513.24 in overnight trade in the US, largely unchanged. Its market cap as of Wednesday’s close stood at $3.815 trillion.
According to a Reuters report, Microsoft first surged past the $1 trillion mark in April 2019. Its move to $3 trillion was more measured than other tech giants, Nvidia and Apple. AI bellwether Nvidia tripled its value in just about a year and clinched the $4 trillion milestone before any other company on July 9.
Microsoft June quarter earnings
Microsoft posted a revenue growth of 18% to $76.4 billion in the April-June period, its fourth fiscal. Analysts on average expected $73.81 billion, according to data compiled by LSEG, according to a Reuters report.
Meanwhile, Microsoft said Azure revenue jumped 39% in the June quarter. Azure sales surpassed $75 billion on an annual basis, the first time it has disclosed that figure, beating expectations for $74.62 billion.
Meanwhile, its capital expenditure forecast of $30 billion for the current fiscal first quarter also came as a positive surprise.
Earnings were supported by the continued strength of Azure and cloud services and Microsoft’s continued push into AI infrastructure, said Ross Maxwell, Global Strategy Lead at VT Markets.
“The results reflect strong investor confidence in Microsoft’s AI and cloud momentum at a time when tech companies are coming under the microscope for valuations. This suggests Microsoft’s focus on positioning itself at the front of AI adoption is working and justifies its premium through solid execution and reliable cash flow,” Maxwell said.
It also suggests that companies with AI revenue and the infrastructure to scale are well-positioned to take advantage of broader optimism within the tech sector, he added.
Microsoft shares: How to trade?
Anshul Jain, Head of Research at Lakshmishree Investment, said, Microsoft has rallied over 45.8% in the past 14 weeks, showing strong momentum but also appearing slightly overextended on the charts.
“Despite this sharp run-up, there are no immediate signs of weakness. Profit booking or a meaningful sell-off is likely to emerge only if the stock breaks below the key swing support at 500. Until that level is breached, the uptrend remains intact,” Jain added.
With momentum still favouring the bulls, the stock looks poised to continue its upward move and potentially test the 550 zone in the near term, he opined.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
