Michael Turin

The tech investing market is going to be focused on Microsoft's CapEx.

We're a billion above street at $31 billion and expecting more than $125 billion this fiscal year from Microsoft.

Microsoft investors are clearly focused on two things.

It's Azure growth.

Can the reacceleration continue?

We've seen really strong net new Azure revenue trends over the past couple of quarters from the company, as well as what you're alluding to, the OpenAI relationship.

Um, we, we call it a sigh of relief yesterday, just that that announcement is out and we're seeing, uh, you saw the stock react well yesterday, just some signs that the companies are working more closely together.

I think it's the first time in a long time we've started to field questions on cloud market share.

Azure has been the dominant market share gainer since ChatGPT took the world by storm.

We've seen Azure just continue to outpace growth of the other hyperscalers.

We're talking about a business that's approaching $100 billion of annual revenue, growing near 40%.

These are unprecedented rates.

But with some of the deals that we've seen announced away from Microsoft starting to show up, there have been questions around just the size and scale of the aspirations of OpenAI and how much of that accrues to Microsoft versus the broader cloud hyperscaler ecosystem.

So this is it.

I mean, we think Microsoft still has the lead in terms of market perception.

That relationship with OpenAI has been very advantageous.

So we think Microsoft share gains have been primary a function of two reasons.

Number one, just the later stage movers to cloud are disproportionately more skewed towards Microsoft and more traditional businesses.

Whereas Amazon won the early adopters, Microsoft's seen the next wave come to cloud.

And then the relationship with OpenAI has really improved the perception of innovation within Azure and created an environment where startups are building using Azure really for the first time.