TNB Tech Minute: Microsoft Earnings Show Investment in AI Is Paying Off

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[00:00:31] Here's your TNB Tech Minute for Wednesday, October 30th. I'm Danny Lewis for The Wall Street Journal. In earnings, Microsoft reported strong quarterly growth in its cloud computing business, indicating its heavy investment in artificial intelligence is paying off. Revenue for its Azure cloud business rose 33% in the quarter through September, beating Wall Street expectations. The company's overall revenue rose 16% to $65.6 billion as its

[00:00:59] net income climbed 11% to $24.7 billion. CEO Satya Nadella has bet the company's future on AI. Microsoft has said it plans to match its spending growth to perceived demand. It has slashed costs in other areas, such as hardware.

[00:01:16] Meta reported record revenue. That's despite seeing slower growth in digital advertising.

[00:01:21] The social media giant posted over $40.5 billion in sales, up 19% compared with a year earlier.

[00:01:28] CEO Mark Zuckerberg has poured immense resources into capitalizing on the AI boom.

[00:01:34] The company has also lost $50 billion on Zuckerberg's bet on the metaverse.

[00:01:39] Meta's Reality Labs unit, which produces the Quest headset and Meta Ray-Ban smart glasses, had operating losses of $4.4 billion in the three-month period.

[00:01:49] Meta expects fourth-quarter revenue to be between $45 and $48 billion.

[00:01:54] And we exclusively report that Wall Street giants, KKR, and Energy Capital Partners have agreed to invest a combined $50 billion in data center and power generation projects to support AI development.

[00:02:07] The company said much of the funds will be invested over the next four years.

[00:02:11] KKR, one of the world's largest investment companies, and Energy Capital Partners, a private equity firm, said they are now working together with big tech companies to accelerate access to electricity.

[00:02:23] For a deeper dive into what's happening in tech, check out Thursday's Tech News Briefing podcast.