12:30 PM EDT, 04/26/2024 (MT Newswires) -- Microsoft ( MSFT ) latest Q3 results showcased yet another strong quarter with impressive outcomes across the board, Wedbush said in a report Friday.

Microsoft Azure's growth soared at 31%, surpassing both the Wall Street's estimate of 29% and the company's own guidance of 28%, driven by strong demand for their updated tech stack.

"Copilot conversions continue exploding with partners/customers lining up for further Copilot deployments to increase efficiencies and profitable growth with more use cases seen across the product portfolio as the AI Revolution heats up," Wedbush said.

In Q3, Microsoft's ( MSFT ) total revenues reached $61.86 billion, surpassing estimates, driven by successful AI integration, the firm said. Looking ahead, Microsoft ( MSFT ) anticipates solid revenue growth for Q4, "as more customers see increased use cases with MSFT's AI technology stack to further expand profitable growth" while generating greater efficiencies across operations despite increasing investments, Wedbush said.

Microsoft ( MSFT ) also issued robust guidance for 2025, anticipating double-digit growth in both revenues and operating income. However, it expects a 1% year-on-year decline in operating margins. Additionally, 2025 capital expenditures are projected to exceed 2024 levels as the company intensifies investments in its cloud and AI infrastructure to secure a larger share of the AI market, the report said.

"We continue seeing this multi-year transformation playing out with various use cases for customers arising across the enterprise landscape with Redmond leading the charge in this '1995 Moment' taking place front and center, " Wedbush said.

Wedbush maintains an outperform rating on Microsoft ( MSFT ) with a 12-month price target of $500.

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