Despite being behind Amazon when it comes to cloud infrastructure, Microsoft CEO Satya Nadella claimed on Tuesday that his company is top of the list for AI workloads such as OpenAI's ChatGPT. Microsoft CFO has estimated that Azure cloud growth in the present quarter could range between 25-26% in terms of constant currency, and up to 2% of this is attributed to the use of AI.
Satya Nadella couldn't resist boasting on Microsoft's hour-long earnings call with analysts on Tuesday, despite the stock falling around 4% after hours. He proudly reported that Microsoft is leading the charge in cloud-based AI services, in comparison to Amazon's 40% share of the cloud infrastructure market. Nadella appreciated that Azure and other cloud services increased by 26% year over year, apart from Dynamics 365, making artificial intelligence an increasingly crucial part of Microsoft's growth. Microsoft has invested billions in OpenAI, a startup that has had its language models hosted on Azure which has gone viral at the end of 2022. Furthermore, Microsoft is integrating the AI models to the Bing search engine and the Windows operating system. Nadella and Amy Hood, the Finance Chief, both expressed their optimism that Azure cloud revenue, which includes AI services, should grow by 25-26%, signifying hundreds of millions in revenue. AI based services have two components; the OpenAI partnership based compute and the revenue driven inference cost. Nadella is confident that both of these can be released on Microsoft's income statement soon.
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