Microsoft’s cloud business is thriving thanks to the increasing demand for AI services, with cloud revenue growing by 26% year over year. The company is expanding its data center capacity to potentially accelerate cloud growth. Investors can benefit from Microsoft’s stock, which has outperformed the S&P 500 with a total return of 150% over the last five years.

Microsoft’s Azure enterprise cloud business, driven by AI cloud services, is a key factor in the stock’s growth. Last quarter, cloud revenue grew 26% to $49 billion, contributing to an 18% total revenue increase to nearly $78 billion. With plans to increase data center capacity by 80%, Microsoft’s cloud business could see accelerated growth.

Analysts predict Microsoft’s earnings to grow at a compound annual rate of 13.5%, potentially outperforming the S&P 500 by 2030. The company’s low-risk profile as a dominant subscription-based software business makes it a strong investment to capitalize on AI growth. Consider joining Stock Advisor for insights on the best stocks to buy now.

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