Microsoft has announced robust quarterly earnings, surpassing analyst expectations with a 16 percent increase in revenue to $65.6 billion. This growth is primarily attributed to significant advancements in the company’s cloud computing and artificial intelligence sectors.

For the quarter ending September 30, the tech giant reported a net income of $24.7 billion, marking an 11 percent rise compared to the same period last year. Earnings per share also saw a 10 percent increase, reaching $3.30.

Chief Executive Officer Satya Nadella emphasized that the transformation driven by artificial intelligence is reshaping work and workflows across all roles, functions, and business processes. He noted that the company is attracting new customers through its AI platforms and tools.

Positioned at the forefront of the generative AI revolution, Microsoft has greatly benefited from its partnership with OpenAI, the creator of ChatGPT. The company has rapidly introduced AI features under its Copilot brand, encouraging its cloud computing clients to adopt the new technology.

Despite the positive earnings, some investors may desire more clarity, according to Jeremy Goldman, Senior Director at Emarketer. He pointed out that while Microsoft is investing heavily in building out AI infrastructure—with significant capital expenditure implications—the immediate revenue returns from AI are more of a future promise than a current reality.

Microsoft’s cloud computing platform, Azure, saw robust growth, with revenue rising by 34 percent when adjusted for currency fluctuations.

During the quarter, Microsoft returned $9.0 billion to shareholders through dividends and share repurchases, contributing to an increase in share value. The company’s stock price experienced a modest increase in after-hours trading.

In related news, Google-parent Alphabet indicated a positive earnings season for major tech firms, as its cloud computing division reported strong results fueled by AI adoption among search engine users.