Microsoft became the second company to surpass a $4 trillion market valuation on Thursday, following a surge in its stock after a strong earnings report. Shares jumped nearly 4.5% at Thursday’s open, pushing the tech giant’s intraday market cap to $4.01 trillion. The stock is now up roughly 28% year-to-date.
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The milestone arrives just 18 months after Microsoft crossed the $3 trillion mark, and six years after first hitting $1 trillion in April 2019. It follows Nvidia, which reached the $4 trillion milestone earlier this month on July 9.
Fueling Microsoft’s rally: a bullish forecast of $30 billion in capital spending this quarter to support its AI expansion, booming Azure cloud revenues, and solid adoption of its Copilot AI chatbot across the Microsoft 365 enterprise suite.
While Microsoft’s rise to $3 trillion was more gradual than peers like Nvidia and Apple, it has since rebounded nearly 50% from April 2025 lows when markets were shaken by President Donald Trump’s tariff push.
Recent progress in trade negotiations ahead of Trump’s August 1 tariff deadline has lifted investor sentiment, helping propel the S&P 500 and Nasdaq to new record highs. Microsoft now stands as the second most valuable U.S. company, trailing only Nvidia.
Microsoft’s multibillion-dollar investment in OpenAI is transforming its business, powering both its Office Suite and Azure cloud services with advanced AI—and helping its stock more than double since ChatGPT’s launch in late 2022.
With exclusive access to OpenAI’s models, Microsoft has surged ahead in the generative AI race, rapidly expanding Azure into its leading revenue stream and strengthening its position against rivals like Google Cloud and Amazon Web Services.
Wall Street’s growing confidence in Microsoft follows a streak of record-breaking revenues since September 2022. The stock has also benefited from workforce reductions and a strategic pivot toward AI, as the company aims to solidify its leadership in a rapidly evolving tech landscape.
While U.S. tariffs have raised concerns about tighter corporate spending, Microsoft’s strong earnings suggest the company has yet to feel significant financial strain from the levies.
Despite its soaring valuation, Microsoft has continued to streamline operations. Earlier this month, it announced plans to cut around 9,000 employees about 4% of its workforce marking its largest round of layoffs since 2023. That follows a separate reduction of 6,000 jobs in May.
A company spokesperson said the July layoffs partly reflect rising employee productivity enabled by new technologies. Though AI wasn’t named directly, the move coincides with a broader industry trend of using AI to enhance efficiency. CEO Satya Nadella previously noted that AI now generates 20% to 30% of Microsoft’s code, underscoring the company’s aggressive push into AI infrastructure.