Microsoft on Wednesday said its profits rose 18% for the January-March quarter, driven by its growth in its cloud computing and artificial intelligence business in a turbulent time for the tech sector.

Microsoft Corp. shares jumped after the company reported stronger-than-expected quarterly sales and profit growth, suggesting customer demand for cloud services has held steady despite a wave of tariffs and economic turbulence.

The results are likely to ease concerns about a potential slowdown in AI demand, after some analysts pointed to canceled data center leases at Microsoft as a sign of excess capacity. Rival Alphabet also posted strong results last week,

Meta raised its capital expenditures guidance for 2025 to $64 billion to $72 billion, signaling huge AI investment by Big Tech is still underway.

U.S. stocks rallied on Thursday, with the Dow and S&P 500 posting their eighth straight session of gains after strong results from megacaps Microsoft and Meta eased concerns about artificial intelligence spending.

Microsoft and Meta Platforms drove Wall Street higher after delivering profits for the start of the year that were even bigger than analysts expected.