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Time of India
a day ago
- Business
- Time of India
Trump Tariffs and .... How Microsoft is the biggest winner this earnings season for Big Tech
Microsoft Corp. shares are within 1.5% of their all-time high from July 2024, driven by a robust 16% gain in May 2025, the stock's best monthly performance in over three years, according to Bloomberg. The rally reflects a broader U.S. equity rebound and renewed confidence in Microsoft's Azure cloud-computing business, fueled by strong artificial intelligence (AI) demand. Azure's fiscal third-quarter revenue grew 33%, surpassing Wall Street expectations, with non-AI services like databases and storage outperforming, as noted by CFO Amy Hood. The stock's resurgence contrasts with its 2024 performance, when Microsoft lagged behind the 'Magnificent Seven' peers -- Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla -- with a 12% gain, weighed down by concerns over Azure growth and AI competition. In 2025, Microsoft's 9% advance has outpaced most peers except Meta (up 10%), bolstered by limited exposure to President Trump's tariffs and strong Big Tech earnings. Analysts see Microsoft as the biggest Big Tech winner this earnings season. Analysts are optimistic, with TD Cowen projecting Azure's AI-related revenue to soar to $24 billion by fiscal 2026, up from $4 billion in 2024. They raised their price target to $540, implying an 18% upside from Wednesday's close, as reported by Bloomberg. Of 72 Bloomberg-tracked analysts, 66 recommend buying Microsoft, with only six holding neutral ratings and none advising to sell. TD Cowen noted that Azure's mid-30% growth trajectory could drive renewed investor interest in Microsoft. Despite trading at a premium—30 times forward profits compared to the Nasdaq 100's 26 times—some see limited short-term upside after recent sideways trading, per Nancy Tengler of Laffer Tengler Investments. However, Kevin Walkush of Jensen Investment Management remains bullish, citing Microsoft's ability to monetize high-margin AI services. 'Microsoft is probably one of the best long opportunities in AI,' Walkush told Bloomberg, highlighting its capacity for sustained revenue growth. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Trading CFD dengan Teknologi dan Kecepatan Lebih Baik IC Markets Mendaftar Undo Microsoft's Azure platform powers AI tools like OpenAI's ChatGPT, alongside traditional cloud services. The company's strategic AI investments, including partnerships and infrastructure expansion, position it to capitalize on growing enterprise demand. Recent Twitter posts echo this sentiment, with users noting Microsoft's AI-driven cloud dominance and stock resilience, though some caution about valuation concerns given its premium pricing.
The Hindu
14-05-2025
- Business
- The Hindu
Microsoft lays off 3% of workforce; Nvidia to sell AI chips to Saudi Arabia; Android unveils design, Gemini updates
Microsoft lays off 3% of workforce Microsoft is laying off 6,000 workers, which is around 3% of its workforce in the biggest job cut announced by the company in more than two years. Most of the affected employees were from Washington, the headquarters of the company with 1,985 workers losing jobs. The Satya Nadella-led company said that although the job cuts will be across teams and globally but they are being done with the goal to reduce the number of managers. The company released their earnings recently showing robust sales and profits that beat market expectations for the quarter. Earlier in January, Microsoft had announced a smaller round of layoffs based on performance. The last round of massive job cuts was in 2023 when the company fired 10,000 workers or almost 5% of its workforce. Company CFO, Amy Hood had said during the earnings call that they were looking to 'increase agility by reducing layers with fewer managers.' The layoffs will also be from the XBox and LinkedIn businesses. The company also has a $80 billion budget for the fiscal year ending June for building AI infrastructure and data centers. Nvidia to sell AI chips to Saudi Arabia AI chipmaker Nvidia will be shipping 18,000 chips to Saudi Arabia after announcing a partnership with a sovereign wealth fund-owned AI startup Humain. The news sent Nvidia shares soaring with CEO Jensen Huang's net worth touching around $120 billion. The deal is one of the many partnerships that have been announced as U.S. President Donald Trump is on a tour to Saudi Arabia, Qatar and UAE. Nvidia's advanced Blackwell AI chips will be used will be used in a 500-megawatt data centre there, the Saudi Arabia-U.S. Investment Forum in Riyadh said. Nvidia said that the first set of chips deployed will be the GB300 Blackwell chips, which were announced earlier this year. Qualcomm also signed a deal with Humain to build a data centre central processor (CPU). AMD is also among the chipmakers that have signed an agreement with Humain. The Lisa Su-led company plans to invest up to $10 billion to deploy 500 megawatts of AI hardware infrastructure over five years. Additionally, Saudi Arabian firm DataVolt will be investing $20 billion in AI data centres in the U.S. Android unveils design, Gemini updates Android has announced a host of updates to its design and new features for better user experience, personalisation and efficiency across platforms, along with more integrations with Gemini. Users will have new colour themes, more responsive interface components and emphasised typography not just on Android smartphones and tablets but also on Wear OS. The upgraded home screen is more organised has quick settings for tailored access and more efficient software updates without lesser battery life. There will also be 'glanceable live updates' so users can track orders easily and get real-time information directly. Google's AI model Gemini will also be a core part of Android now with Gemini Live and more integrations with camera and screen sharing. Gemini will also bring its conversational AI feature to smartwatches, Google TV, Android Auto and Android XR platforms making actions more intuitive.
India Today
14-05-2025
- Business
- India Today
Microsoft to layoff more than 6,000 employees, says it is for the company's success: Full story in 5 points
Microsoft has announced that it is cutting 3 per cent of its workforce, which is more than 6,000 of its employees. While job cuts have become fairly common across tech companies over the past two years, this round is particularly significant for Microsoft. It's the company's biggest reduction in headcount since early 2023, when it laid off 10,000 employees in one of its most dramatic shake-ups to date. The company reportedly told The Verge that the layoffs are a way to make 'organisational changes necessary to best position the company for success in a dynamic marketplace'.advertisementHere is everything that is happening at Microsoft, in 5 quick down while scaling upSo why is Microsoft laying off thousands of employees while also expanding rapidly in areas like artificial intelligence (AI)? The answer lies in what many companies call strategic realignment. According to a statement from the company, the layoffs are part of 'organisational changes necessary to best position the company for success in a dynamic marketplace,' says the company. In simpler terms, Microsoft is trying to reshape itself for the future, one that is increasingly defined by AI and cloud computing. But building that future doesn't come cheap. The company is investing tens of billions of dollars into data centres and infrastructure to support its growing AI tools and services. Reports suggest that Microsoft's capital spending this year alone could touch a staggering $80 billion, a large part of which is earmarked for AI-related expansion. These investments are essential to remain competitive with the likes of Google, Amazon, and Meta, but they come with a trade-off: higher operating costs and tighter profit the layoffs now?advertisementOne big change internally is Microsoft's attempt to 'flatten' its corporate structure. During a recent earnings call, Microsoft chief financial officer Amy Hood hinted at cutting down on management layers, suggesting the company is looking for more direct and nimble decision-making. While the details of which teams are being impacted haven't been made public, reports suggest that employees across various levels and departments, including LinkedIn and Microsoft's international offices, are cuts at MicrosoftIn addition, the company had already begun performance-based job cuts earlier this year. But this new round is much broader and unrelated to performance. It's more about making Microsoft leaner and more focused on its core just about software any moreAlthough Microsoft is still best known for its software and Windows operating system, its business has evolved massively. Today, Microsoft is a cloud-first, AI-obsessed tech powerhouse. Its cloud division, Azure, continues to grow, but even there, profit margins are beginning to shrink. In the most recent financial quarter, Microsoft Cloud's profit margins dropped from 72 per cent to 69 per cent year-over-year, a sign that even high-performing divisions aren't immune to cost there is a possibility that the company is trying to make up for the enormous cost of AI expansion by reducing headcount. "We believe that every year Microsoft invests at the current levels, it would need to reduce headcount by at least 10,000 in order to make up for the higher depreciation levels due to their capital expenditures," Technology analyst Gil Luria at DS Davidson told an isolated moveMicrosoft isn't alone. Across Silicon Valley, companies are betting big on AI while quietly trimming staff. Google, Meta, and Amazon have all laid off thousands of employees over the past two years, even as they ramp up investments in generative AI, cloud services, and new data centres.
Yahoo
14-05-2025
- Business
- Yahoo
Microsoft will lay off nearly 6,000 employees in push for efficiency
Microsoft has plans to trim its workforce through layoffs. The planned layoffs will reduce the Washington-based tech company's total workforce by 3%, CNBC first reported on Tuesday. The number of jobs getting cut is approximately 6,000. A spokesperson for Microsoft confirmed it has plans for job cuts in a statement to FOX Business, saying the company continues to "implement organizational changes necessary to best position the company for success in a dynamic marketplace." It is looking to streamline its processes, procedures and roles and decrease management layers to move more quickly and boost efficiency, according to Microsoft. Roughly 228,000 people worked for Microsoft around the world as of the end of June 2024, though the company has axed some jobs since then, reports indicate. Microsoft Cuts 1,900 Jobs In Gaming Division Read On The Fox Business App During the company's third-quarter earnings call in late April, CFO Amy Hood said Microsoft's headcount at the end of March was "2% higher" than it was at the same time last year but "slightly down" from the second quarter. The layoffs announced Tuesday will hit Microsoft employees of different levels working in various teams and places around the world, according to CNBC. Microsoft said it will make use of new technologies and capabilities to help "empower employees to spend more time focusing on meaningful work." Microsoft Wins Appeal In Ftc Challenge To $69 Billion Activision Blizzard Deal The company has multiple business segments, providing software, computers, gaming consoles, productivity applications, cloud services and more. It has also been leaning more and more into artificial intelligence-powered offerings. In the third quarter, Microsoft generated nearly $70.07 billion in revenue. Its net income, meanwhile, widened to $25.82 billion. Microsoft Shuts Down Skype After 22 Years, Shifting Users To Teams The company's market capitalization hovered around $3.34 trillion as of Tuesday article source: Microsoft will lay off nearly 6,000 employees in push for efficiency Sign in to access your portfolio
Hindustan Times
14-05-2025
- Business
- Hindustan Times
Microsoft to lay off 6,000 employees in biggest round of job cuts since 2023
Continuing the streak of mass layoffs in the tech sector, Microsoft has decided to lay off around 6,000 of its employees, which amounts to around 3% of the tech giant's total workforce. The announcement came on Tuesday. This round of job cuts is Microsoft's second biggest since 2023, when the company laid off around 10,000 employees. The move comes as the tech conglomerate shifts focus towards artificial intelligence to keep up with the competition. One of the most affected geographies by this round of job cuts is Washington, where as many as 1,985 workers are being asked to leave at the company's headquarters in Redmond, according to an AP report. Most of these employees are in software engineering or product management roles. Also read: Microsoft to CrowdStrike: These tech firms lead 2025 layoffs as 50,000 jobs vanish in 5 months According to Microsoft, the layoffs are being done across all teams, levels and geographies and are mainly focused on slashing the number of managers at the company. The job cuts also affect Microsoft's video gaming platform, Xbox, and its career networking platform, LinkedIn. 'We continue to implement organisational changes necessary to best position the company for success in a dynamic marketplace,' said the company spokesperson on the reason behind the job cuts. Just a month ahead of the job cuts, Microsoft announced sales and profits that exceeded the expectations of Wall Street in the January to March quarter this year. It announced a revenue of $70.1 billion and net income of $25.8 billion. During a call about the earnings of the January-March quarter, Microsoft's chief financial officer, Amy Hood, said that the company was focused on 'building high-performing teams and increasing our agility by reducing layers with fewer managers,' reported AP. As of June last year, a total of 228,000 people were employed by Microsoft full-time, out of which, 55% were in the US. 'I think many people have this conception of layoffs as something that struggling companies have to do to save themselves, which is one reason for layoffs but it's not the only reason. Big tech companies have trimmed their workforces as they rearrange their strategies and pull back from the more aggressive hiring that they did during the early post-pandemic years,' AP quoted Daniel Zhao, lead economist at workplace reviews site Glassdoor, as saying. With AP inputs.
