On Thursday, Microsoft reached a market valuation of $4 trillion (approximately Rs. 3,49,15,020 crore), marking it as the second publicly traded company to achieve this milestone, following Nvidia. This surge was fueled by a strong earnings report that indicated the company’s significant investments in artificial intelligence (AI) are yielding positive results.
The impressive performances from Microsoft and Meta Platforms later that day also contributed to gains for Amazon, while chipmaker Nvidia hit an all-time high. Together, these major players in the AI sector saw their combined market value increase by over half a trillion dollars.
Leading entities in the AI landscape, including Nvidia, Microsoft, Amazon, Alphabet, and Meta Platforms, now represent a quarter of the S&P 500, as reported by LSEG data.
Microsoft projected a record $30 billion in capital expenditures for the first quarter of the current fiscal year to accommodate the increasing demand for AI. The company reported significant growth in its Azure cloud computing business and noted that its Copilot AI tools had surpassed 100 million monthly active users.
Shares of Microsoft saw an increase of 4.5 percent following a rise of as much as 8 percent earlier in the day.
Gerrit Smit, lead portfolio manager at Stonehage Fleming Global Best Ideas Equity Fund, commented on Microsoft’s transformation, stating, “It is in the process of becoming more of a cloud infrastructure business and a leader in enterprise AI, doing so very profitably and cash generatively despite the heavy AI capital expenditures.”
Meta Platforms is also intensifying its focus on AI, forecasting quarterly revenue that outstripped Wall Street expectations, significantly enhancing its core advertising business.
Headquartered in Redmond, Washington, Microsoft attained its first $1 trillion market value in 2019. The company reached $3 trillion at a steadier pace compared to its competitors, with Nvidia achieving a tripling of its value in just about a year and reaching the $4 trillion mark on July 9.
Apple’s latest market valuation stands at approximately $3.12 trillion.
Recent positive developments in trade negotiations between the United States and its trading partners in anticipation of President Donald Trump’s August 1 tariff deadline have also bolstered stock performance, helping drive the S&P 500 and Nasdaq to new highs.
Microsoft’s substantial investment in OpenAI is proving to be transformative, infusing AI technology into its Office Suite and Azure offerings, and contributing to a significant increase in its stock value since the late-2022 launch of ChatGPT.
The company’s forecast for capital expenditures represents its largest planned expenditure for a single quarter, positioning it to potentially outpace competitors over the upcoming year.
Meta has also increased the lower bound of its annual capital expenditures by $2 billion, shortly after Alphabet made a similar announcement, indicating that the competition in AI technology is intensifying among Silicon Valley firms.
Cloud services giant Amazon.com saw a 2 percent rise in share value ahead of its quarterly earnings report, while AI chip manufacturer Nvidia increased by 0.8 percent, raising its market capitalization to an unprecedented $4.4 trillion.
© Thomson Reuters 2025
