Microsoft’s Earnings Surge Adds a Record $151 Billion in Value

Microsoft Corp.'s rise positions the software company for its largest single-day market value gain in history. 

‍

The stock of the Windows software developer jumped as much as 8% on Wednesday after announcing solid quarterly earnings, indicating that corporate cloud computing demand remains robust. According to the data, if the gains continue, the company's market worth will increase by $151 billion, the largest in the company's history.

‍

With the market value of tech companies steadily increasing, even little rallies have resulted in massive returns. According to the data, Apple Inc. and Amazon.com Inc. added more than $190 billion in market value in single sessions last year. 

‍

Microsoft results, along with Alphabet Inc. earnings that exceeded expectations, helped alleviate concerns that this year's rally in technology stocks may be overdone. Microsoft's Azure cloud-computing division saw sales increase by 31% discounting currency swings, meeting the average analyst forecast.

‍

Following the report, both Macquarie Research and BMO Capital Markets upgraded Microsoft to outperform, increasing the total number of analysts recommending a buy equivalent to 54.

‍

According to BMO's Keith Bachman, the upgrade reflects their "higher conviction that Azure growth headwinds will moderate" by the end of the year and "AI can help support longer-term growth."

‍

The software giant is on track to reach a market valuation of $2.2 trillion, reclaiming the position of the world's second most valuable public corporation. Microsoft would surpass the $2.1 trillion valuation of Saudi Aramco. Apple is still the most valuable business, with a market capitalization of $2.6 trillion as of Tuesday's close.

‍

"While the stock is not cheap, we believe the long-term growth prospects warrant a premium valuation," he said.

‍

Microsoft shares momentarily fell in premarket trade Wednesday after Britain's antitrust agency banned the company's $69 billion merger with Activision Blizzard Inc., claiming it would hinder cloud competition. 

‍

Microsoft stated that it is still committed to the purchase and intends to appeal the judgment.

‍