Microsoft’s quarterly sales and profit climbed more than projected, lifted by corporate demand for the software maker’s cloud and artificial intelligence offerings.

Revenue in the third quarter, which ended March 31st, rose 17 per cent to $61.9 billion (€57.7 billion), while profit was $2.94 a share, the company said in a statement on Thursday. Analysts on average estimated per-share earnings of $2.83 on sales of $60.9 billion.

Chief executive Satya Nadella has been infusing Microsoft’s entire product line with AI technology from partner OpenAI. The bet is starting to pay off, with some customers adding AI tools that summarise documents, generate new content to their Office productivity software or Azure cloud subscriptions, or buying more cloud services that enable them to build and run their own AI applications.

“Microsoft’s generative AI-specific revenue has already become a key stock driver,” said Dan Morgan, a senior portfolio manager at Synovus Trust. “Microsoft appears to be in an excellent position to thrive. Microsoft is really in the driver’s seat when it comes to AI.”

Azure revenue gained 31 per cent in the quarter, above an average prediction of 29 per cent, picking up slightly from the 30 per cent growth in the previous period.

Microsoft’s shares rose about 6 per cent in late trading. They had closed at $399.04 in New York. The stock climbed 12 per cent in the March quarter on optimism that the company’s early lead in releasing generative AI products would boost sales. – Bloomberg