Microsoft's latest financial report shows that its artificial intelligence business is developing rapidly, but the growth rate of cloud computing may slow down in the short term. This has attracted investors' attention to the company's short-term growth expectations, but the long-term development prospects are still optimistic. Financial report data shows that Azure OpenAI service usage doubled in the past six months, and the AI business is expected to reach US$10 billion in annualized revenue in the second quarter, setting a record for the company's fastest business development. However, supply still cannot fully meet market demand, which may lead to a slowdown in the growth rate of smart cloud services in the short term.
Microsoft's latest financial report shows that the artificial intelligence business is growing at an unprecedented rate, but the growth rate of cloud computing may face a short-term slowdown. In the recent first-quarter earnings call for fiscal year 2024, Microsoft CEO Satya Nadella revealed that the use of Azure OpenAI services has doubled in the past six months, and the AI business is expected to be in the second quarter. The annualized revenue will reach US$10 billion, setting a record for the company's fastest business development.
Faced with the rising demand for AI, Microsoft Chief Financial Officer Amy Hood admitted that the company's current AI service supply still cannot fully meet market demand. Data shows that the smart cloud business unit, including the Azure cloud computing platform, performed well, with revenue increasing by 20% year-on-year to US$24.09 billion, but it still failed to meet analyst expectations.
Nadella pointed out that AI is driving fundamental changes in the commercial application market, and more and more customers are shifting from traditional applications to business processes centered on AI. However, Hood expects that the growth rate of smart cloud business may slow to 18%-20% in the second quarter, and Azure's growth rate is expected to drop to 31%-32%, but is expected to speed up again in the second half of fiscal 2025.
Affected by this news, Microsoft's stock price fell about 3% in after-hours trading. As of Wednesday's close, the company's shares have risen 15% this year. This phenomenon reflects investors' cautious attitude towards the company's short-term growth expectations, but the long-term development prospects are still optimistic.
It is worth noting that despite the challenges of short-term slowdown in growth, Microsoft's rapid development in the field of AI is still impressive. The company is actively expanding its production capacity to meet market demand, which indicates that the AI business may continue to maintain a strong growth trend in the future.
Although Microsoft faces the challenge of slowing cloud computing growth in the short term, the strong growth of its AI business and positive capacity expansion show that it occupies a leading position in the AI field and has huge future development potential, which is worthy of continuous attention.