Microsoft’s Q3 fiscal 2025 financial report reveals strong performance and positive results for the company, with revenue hitting $70.1 billion, a 13% increase from the same period last year.

Net income also increased 18% to $25.8 billion, and diluted earnings per share increased 18% to $3.46.

Microsoft also saw strong growth across its server products and cloud services, with revenue jumping 22%, driven by strong growth in Azure and other cloud services, which rose 33%. AI contributed 16% points to Azure’s growth, slightly above expectations. The company said Azure, which offers a wide range of services to help businesses and developers build, run and manage cloud applications, is closely watched by investors and analysts as a key indicator of AI adoption trends.

The report also shows that Microsoft’s commercial cloud segment played a crucial role in driving cloud and AI growth. Revenue surged 20% year-over-year to $42.4 billion, fueled by strong demand. Key drivers included an 11% increase in Microsoft 365 Commercial revenue, with cloud growth reaching 12%, and an 11% rise in Dynamics cloud revenue, boosted by a 16% jump in Dynamics 365. The company’s Intelligent Cloud segment also performed well, generating $26.8 billion in revenue, a 21% increase.

“Cloud and AI are the essential inputs for every business to expand output, reduce costs, and accelerate growth,” said Satya Nadella, chairman and CEO of Microsoft. “From AI infra and platforms to apps, we are innovating across the stack to deliver for our customers.”

“With customers ranging from Coca-Cola to Abercrombie & Fitch accelerating their cloud journeys, Microsoft is capturing the benefits from that transition,” Nadella noted.