Content and data provided by various third parties and Fidelity − Terms of Use | Help/Glossary
Research > ETFs > ETF / ETP Commentary > 

Microsoft Earnings Reaffirm Strength in Cloud Computing, AI

BY | ETF Database
05/13/2025 | 113 VIEWS
Microsoft and the cloud computing sector appear to have sloughed off April volatility showers . The software maker has been rallying post-Q1 earnings. That could be an indicator of ongoing strength in cloud computing as well as AI.Microsoft’s cloud computing services, Azure, got much of the praise for its strong revenues. Revenues topped 33%, beating out The Street and CNBC analyst forecasts of 30.3%. “Clearly, the macro environment remains a wild card, but with Azure back in ‘beat/raise’ mode, we believe that overhang now turns into a tailwind and highlights not only the significant demand for AI services on Azure, but also MSFT’s broad base of infrastructure offerings to support the ongoing migration of enterprise workloads to the cloud,” said Evercore ISI’s Kirk Materne. Of course, strong earnings make for a happy CEO. With Microsoft’s Magnificent Seven peers also looking to bolster their own cloud and AI capabilities, this is a palpable win for the software maker. “It was a record quarter driven by continued strength of Microsoft Cloud,” said Satya Nadella, Microsoft’s CEO. “Cloud and AI are the essential inputs for every business to expand output, reduce costs, and accelerate growth.” Traders who think Microsoft can maintain their post-Q1 earnings momentum may want to look at the Direxion Daily MSFT Bull 2X Shares (MSFU ). Likewise, traders sensing the euphoria may subside can also look to play a pullback with the Direxion Daily MSFT Bear 1X Shares (MSFD ). Having both funds available allow traders to maintain flexibility, especially in a volatile market such as now.Trade the SectorsStrength in Microsoft could portend to strength ahead for cloud computing and AI. If traders don’t want the concentration risk that comes with individual stocks, they can choose to trade the broad sectors of cloud computing and AI. Specifically, traders can use the Direxion Daily Cloud Computing Bull 2X Shares ETF (CLDL C), which capitalizes off cloud-computing growth. Exposure to AI is available via the Direxion Daily Robotics, Artificial Intelligence & Automation Index Bull 2X ETF (UBOT B-). The most recent tariff volatility isn’t stopping the growth of cloud computing and AI. The top movers and shakers in both technologies should continue to exhibit growth as the world becomes more reliant on technology. “In the most recent quarter, the three leading cloud providers demonstrated robust growth in their cloud businesses, with artificial intelligence (AI) emerging as a key driver across all platforms,” ITPro Today mentioned. For more news, information, and analysis, visit the Leveraged & Inverse Channel.

More Commentary

Put/Write ETF Could Gain Steam as Investors Embrace Options ETFs
BY | ETF Database
05/23/2025 | 58 VIEWS
Most Recent Tech Earnings Ease Anxiety Over AI Trade
BY | ETF Database
05/22/2025 | 37 VIEWS
In Ongoing Volatility, Look to Hedged Equity Strategies
BY | ETF Database
05/22/2025 | 54 VIEWS
View more Commentary

Search Commentary

Enter Keyword(s)
Filter Results

Performance data shown is past performance and is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. Yield and return will vary, therefore you have a gain or loss when you sell your shares. For standard quarterly performance, go to the fund's Snapshot page by clicking on the ETF/ETP's symbol.

ETFs may trade at a premium or discount to their NAV and are subject to the market fluctuations of their underlying investments.

For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Please note, this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral. Additional information about the sources, amounts, and terms of compensation can be found in the ETF's prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock, Inc. and its affiliates.

FBS receives compensation from the fund's advisor or its affiliates in connection with a marketing program that includes the promotion of this security and other ETFs to customers ("Marketing Program"). The Marketing Program creates incentives for FBS to encourage the purchase of certain ETFs. Additional information about the sources, amounts, and terms of compensation is in the ETF's prospectus and related documents. Please note that this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral.

News, commentary (including "Related Symbols") and events are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.

Any data, charts and other information provided on this page are intended to help self-directed investors evaluate exchange traded products (ETPs), including, but limited to exchange traded funds (ETFs) and exchange traded notes (ETNs). Criteria and inputs entered, including the choice to make ETP comparisons, are at the sole discretion of the user and are solely for the convenience of the user. Analyst opinions, ratings and reports are provided by third-parties unaffiliated with Fidelity. All information supplied or obtained from this page is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell a particular security, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating ETPs. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation and other individual factors and re-evaluate them on a periodic basis.

Before investing in any exchange traded product, you should consider its investment objective, risks, charges and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.