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A few weeks ago, Nvidia became the first company in the world to reach the coveted $4 trillion market capitalization. This was on the back of a strong quarter where it raked in $44.1 billion, fueled by the strong demand for its AI-optimized hardware. Now, Microsoft has a similar story to tell following its latest fiscal quarter reports from yesterday.
After informing investors and the public that it earned $76.4 billion in FY25 Q4, resulting in a net income of an eye-watering $27.2 billion, Microsoft"s stock price has jumped by roughly 5%, which means that it has crossed the $4 trillion market cap. It is only the second company to reach this mark as others are quite a ways off. Apple stands strong at $3.1 trillion, Google"s parent company Alphabet is at $2.3 trillion, and Meta is about to hit the $2 trillion-mark.
It"s not entirely surprising that Microsoft managed to reach this market cap so soon after its latest fiscal report. The company"s reason for soaring market value is the same as Nvidia: AI and the cloud. Microsoft CEO Satya Nadella credited the firm"s investments in the cloud and AI, also noting that Azure passed $75 billion in annual revenue. Other categories like Productivity and Business Processes, Intelligent Cloud, and More Personal Computing grew too.
Microsoft"s Chief Financial Officer Amy Hood also had the following to say:
We closed out the fiscal year with a strong quarter, highlighted by Microsoft Cloud revenue reaching $46.7 billion, up 27% (up 25% in constant currency) year-over-year.
While Microsoft celebrates reaching this milestone, it is also worth highlighting that the company recently laid off 9,000 employees despite enjoying a particularly strong quarter. Satya Nadella noted shortly after that the decision weighs heavily on him, but unfortunately, this is the "enigma of success". Whatever that means.