Microsoft becomes second $4 trillion company after strong earnings

Microsoft has officially crossed the $4 trillion market capitalisation threshold in after-hours trading, joining Nvidia in an elite club of tech titans buoyed by the AI boom. The jump follows the company’s robust earnings report, which revealed its fastest revenue growth in more than three years.

Shares of Microsoft rose 8% after markets closed on Wednesday, pushing its valuation to around $4.1 trillion. If the rally holds during Thursday’s trading session, Microsoft will become the second company after Nvidia to reach the milestone this month.

The surge was fuelled by exceptional performance in Microsoft’s cloud business. For the first time, the company disclosed dollar revenue figures for Azure. Sales from Azure and related cloud services reached over $75 billion in fiscal 2025, marking a 34% year-on-year increase. Overall, Microsoft’s total revenue rose by 18%, highlighting growing momentum across its ecosystem.

As of Wednesday’s close, Microsoft stock had climbed 22% in 2025, significantly outperforming the S&P 500’s 8% gain. The stock touched a record close of $513.71 on July 25 and soared above $553 in extended trading after the earnings report.

Nvidia, now valued at over $4 trillion as well, has been the top-performing tech megacap in 2025, up 33% for the year. Its graphics processing units (GPUs) are the backbone of AI infrastructure, powering large language models for companies like Microsoft, OpenAI, Google, and Meta. These chips are also key to the rapidly expanding data centre investments by Big Tech.

Apple, once the frontrunner in market value, has fallen to third place with a market cap of around $3.2 trillion. Its shares have dropped 17% this year amid concerns that the company is falling behind in artificial intelligence. Apple is set to report quarterly earnings on Thursday.

Nvidia is scheduled to release its next earnings report in late August.