Aug 1 (V7N) — Microsoft (MSFT.O) has reached a historic milestone, becoming the second publicly traded company after Nvidia (NVDA.O) to surpass a $4 trillion market valuation. The software giant's sharp rise follows a strong quarterly earnings report that highlighted explosive growth driven by its investments in artificial intelligence (AI).
 
The company’s stock surged as much as 8% on Thursday before settling at a 4.5% gain, fueled by robust performance in its Azure cloud computing division and growing adoption of its AI-driven Copilot tools, which have now surpassed 100 million monthly active users. Microsoft also announced a record $30 billion in projected capital spending for the first quarter of its fiscal year—its largest-ever quarterly investment—aimed at meeting soaring global demand for AI infrastructure.
 
“Microsoft is transforming into a cloud infrastructure powerhouse and a leader in enterprise AI,” said Gerrit Smit, lead portfolio manager at Stonehage Fleming Global Best Ideas Equity Fund. “It’s achieving this profitably despite its significant capital expenditures.”
 
The rally in Microsoft stock, alongside impressive earnings from Meta Platforms (META.O), contributed to gains in Amazon (AMZN.O) and propelled Nvidia to another all-time high. The combined market capitalization of these four AI-driven giants surged by over half a trillion dollars in a single day.
 
According to LSEG data, the five tech titans leading the AI charge—Microsoft, Nvidia, Amazon, Alphabet (GOOGL.O), and Meta—now represent roughly 25% of the total value of the S&P 500 index.
 
Meta Platforms also exceeded expectations, forecasting quarterly revenue well above analyst estimates, thanks to AI-powered improvements in its core advertising operations. The company increased the lower end of its annual capital spending outlook by $2 billion, following a similar move by Alphabet—signaling a rapid acceleration in the AI arms race across Silicon Valley.
 
Microsoft’s investment in OpenAI, the developer behind ChatGPT, has fundamentally reshaped its business. AI capabilities have been deeply integrated into products such as Microsoft Office and Azure, helping double the company’s stock value since ChatGPT's public launch in late 2022.
 
Microsoft originally reached the $1 trillion mark in 2019. Its more gradual journey to $3 trillion was recently outpaced by Nvidia, which tripled in value within a year to cross the $4 trillion threshold on July 9. Apple (AAPL.O), once the most valuable public company, currently sits at a valuation of approximately $3.12 trillion.
 
Meanwhile, investor sentiment was also lifted by progress in global trade negotiations ahead of a U.S. tariff deadline, further pushing the S&P 500 and Nasdaq to record highs.
 
As Microsoft outpaces its peers in AI capital spending, analysts suggest the company could lead the next phase of enterprise technology transformation—driven by scalable AI integration across cloud services and productivity platforms.
 
END/WD/SMA/