Microsoft increases its market value by 33%, thanks to games and AI

A Microsoft reached a historic milestone this year by reaching a market valuation of a whopping $3 trillion, cementing its status as one of the largest public stocks, driven in large part by growth in artificial intelligence (AI).

Microsoft’s market value sees impressive growth in 2024

The company’s shares rose up to 1.6%, reaching US$405.13 (around R$1,900), resulting in a market capitalization that exceeds US$3 trillion.

This feat puts Microsoft at the top, surpassing even Apple for a brief moment.

Microsoft’s revenue growth is mostly driven by artificial intelligence and the games sector – Image: Dado Ruvic/Reuters/Reproduction

The growing interest of investors in AI is evident, and Microsoft has been leading this movement.

AI, with its potential to generate efficiency gains, new investments and increased productivity, has been a major driver of technology stocks.

Microsoft, one of the so-called Magnificent 7, is at the forefront of advancing this sector, recording an impressive gain of around 57% throughout 2023.

This year is no different, with an additional 7.7%, surpassing the Nasdaq 100 index by 2.8%. Microsoft’s share of the S&P 500 index is 7.3%.

Revenue from Microsoft’s intelligent cloud, led by Azure, reached US$25.9 billion, registering an increase of 20% compared to the previous year.

Continued investment in AIincluding strategic partnerships with OpenAI, has been very important for this growth.

The recent expansion of Copilot, Microsoft’s AI assistant, to all users of the Office suite, including Word and Excel, shows the company’s commitment to growing in the area.

AI and games generate returns for the company

Microsoft released financial results for the second quarter of fiscal 2024, with net profit of US$21.9 billion, representing a 33% increase compared to the same period last year. Total revenue reached US$62 billion, an additional 18%.

Gaming-related profits, driven by the purchase of Activision Blizzard, grew an impressive 61%, reaching US$7.5 billion.

The results of Xbox Game Pass and increased subscribers to Microsoft 365 contributed to this success.

Microsoft Cloud, responsible for revenue of US$33.7 billion, was the profitability leader, with a gross margin of 72%.

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The number of Microsoft 365 Consumer subscribers reached 78.4 million, showing an increase of almost 16% compared to the previous year.

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