Cloud and AI Boost U.S. Big Tech Performance; AI Alliances Restructure Intensifies

Microsoft Corp. (NASDAQ: MSFT) reported revenue of $82.9 billion and net income of $31.8 billion for the quarter ending March 31, up 18% and 23% year-over-year, respectively. Cloud revenue rose 29% to $54.5 billion, while its AI-related business reached an annualized revenue run rate of $37 billion. During the same period, Microsoft returned about $10.2 billion to shareholders through dividends and share repurchases. Chief Human Resources Officer Amy Coleman sold a portion of her holdings on the open market, and former EY chairman Carmine Di Sibio joined the board, expanding it to 13 members.

Recently, Microsoft restructured its partnership with OpenAI by removing the exclusivity clause that barred OpenAI from using other cloud providers. In exchange, the companies agreed to cap Microsoft’s total revenue share from OpenAI at $38 billion through 2030. Separately, disclosures show that Microsoft has invested more than $100 billion to date in OpenAI-related funding and infrastructure, highlighting the substantial costs of scaling AI capacity.

As the maker of Windows, Office and Azure, Microsoft is a leading U.S. software and cloud provider and a key competitor in the global cloud market and generative AI infrastructure race. The expansion of AI services powered by Azure and OpenAI models, alongside fellow hyperscalers Amazon and Google, is a major factor shaping future U.S. IT capital expenditure and productivity trends.