Microsoft shrugs off AI bubble fears again with strong financial results

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Investor interest in Microsoft shares may have weakened in recent months, but the company posted strong financial results on Wednesday which yet again demonstrated that the AI boom is roaring on.Microsoft reported earnings for the second quarter of fiscal year that are likely to keep the party going for Wall Street, despite slowing growth in its key cloud computing business.Microsoft reported revenues of $81.27bn against expectations of $80.32bn, and improved from the 12.

3% increase it recorded in the same quarter last year.Earnings came in at $4.14 per share against expectations of $3.92.“We are only at the beginning phases of AI diffusion, and already Microsoft has built an AI business that is larger than some of our biggest franchises,” said the company’s CEO, Satya Nadella.

“We are pushing the frontier across our entire AI stack to drive new value for our customers and partners.”Microsoft shares fell 4% in extended trading on Wednesday after the software maker posted slowing cloud growth.Microsoft has been one of the primary beneficiaries of the AI boom, but investor confidence in it has slipped of late.Six months ago, the company hit the vaunted level of a $4tn market capitalization.Three months ago, it beat analysts’ revenue expectations by 2.

9%, reporting revenues up 18.4% year on year.The four largest AI spenders – Microsoft, Alphabet, Amazon and Meta – are expected to spend $505bn on AI infrastructure this year alone, up from roughly $366bn in 2025.But shares in the company have slumped 11% since as investors’ anxieties over the billions being pumped into AI without corresponding returns have increased.Despite those fears, Microsoft has exceeded Wall Street’s expectations in every quarter over the past two years.

In its last earning report, Microsoft said orders booked by its Azure cloud-computing business, which incorporates AI, “significantly” exceeded capacity.Revenue to that unit was that projected to rise 38% from a year earlier.On Wednesday, Microsoft said Azure revenues grew 39%, compared with 40% growth in the fiscal first quarter.“Microsoft Cloud revenue crossed $50bn this quarter, reflecting the strong demand for our portfolio of services,” said Amy Hood, executive vice-president and chief financial officer of Microsoft.“We exceeded expectations across revenue, operating income and earnings per share.

”Asked about return of investment from Azure, Hood said it was better to think about it as “an allocated capacity guide about what we can deliver in terms of Azure revenue”,As Microsoft spends massive capital on computing capacity, she said, “we’re really making long-term decisions”, pointing to increased sales and usage across its AI products,“Then we make sure we’re investing in the long-term nature of R&D and product innovation”,But Microsoft’s 365 Copilot AI unit is facing increased competition, including from Anthropic’s Claude Cowork, a desktop AI tool meant to act as a more accessible version of Claude Code,Wedbush’s Dan Ives said this week he viewed Microsoft “as the clear front-runner on the enterprise hyper-scale AI front despite increasing competition from Amazon and Google”.

The most recent US productivity report showed strong gains without increased work- hours, suggesting that the gains could be attributed to AI.
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Georginia Hayden’s quick and easy recipe for roast sprout salad with anchovies and parmesan | Quick and easy

Brussels sprouts are for life, not just for Christmas. They’re still making a regular appearance in our house, from shredded and stir-fried with chilli and spice, to roasted and dressed, as in this salad. And what a salad it is: with a caesar-esque dressing, it is crisp, salty and crunchy, and hits all the right notes. You can bulk it out, if you like, by topping it with a few soft, jammy boiled eggs cut into wedges or some shredded leftover chicken. However, it is pretty perfect as it is, as a light lunch or side

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‘Dad never took his customers for granted’: remembering Abdul’s in Sydney’s ‘Little Lebanon’

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How to make a clootie dumpling – recipe | Felicity Cloake's Masterclass

Clootie dumpling is, let’s face it, a much better name than spotted dick, but if you were fond of the latter at school, you’ll probably enjoy this very similar, classic Scottish steamed pudding. Not too sweet and, thanks to the apple and carrot, lighter than it sounds, this is a proper winter dessert and the perfect end to a Burns supper, especially when served with custard or ice-cream.Prep 20 min Cook 3 hr 15 minServes 8-10110g fresh suet, or dried suet or a vegetarian alternative225g plain flour, plus extra for dusting½ tsp baking powder ½ tsp fine salt 1 tsp mixed spice 1 tsp ground ginger ¼ tsp ground allspice ¼ tsp nutmeg 110g soft brown sugar 75g fine fresh breadcrumbs 25g coarse oatmeal, or 25g extra breadcrumbs 200g currants 100g sultanas or raisins – golden ones look especially pretty 1 large green apple 1 carrot Finely grated zest of 1 unwaxed orange or lemon 1 egg, beaten2 tbsp treacle About 60ml milkHalf-fill a large saucepan for which you have a lid with water, then bring to a boil (if you have a pan with handles on the side, so much the better). Soak a clean tea towel (a smooth one, rather than anything fluffy or towel-like) or cheesecloth in water. And have ready some butcher’s string, or similar

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Tin Roof Cafe, Maldon, Essex: ‘Come for topsoil, stay for the shortbread’ – review

A tipoff to try the Tin Roof Cafe in Maldon came with prior warning: I wouldn’t get a table easily as this all-day spot serving brunch, lunches and sweet stuff from the in-house bakery is constant, scone-fuelled bedlam. Red brick walls, greenery throughout, alfresco spaces, allotments growing fresh veg and herbs. Capacious, family-run, dog-welcoming, pocket-friendly. There’s bubble and squeak with hand-cut ham, Korean-style chicken burgers and a vegan burger called, rather brilliantly, “Peter Egan” after, I’m guessing, the animal-loving actor who played Paul in Ever Decreasing Circles.Could this place be any more adorable? No, but still, brace yourself

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Ignore the snobbery and get into blended whisky

We have Robert Burns to thank for perhaps the greatest poem about any dish ever – a poem so good that it inspires an entire nation to dedicate an evening of each year to eating haggis, even though most people find it kind of gross.The Guardian’s journalism is independent. We will earn a commission if you buy something through an affiliate link. Learn more.No? If the “Great Chieftan o’ the Puddin-race” were that delicious, we’d all be eating it all the time, surely? And yet Burns’ Address to a Haggis is enticing enough to dispel any such doubts just once a year

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Helen Goh’s recipe for Breton butter cake with marmalade | The sweet spot

A Breton butter cake is a proud product of Brittany’s butter-rich baking tradition: dense, golden and unapologetically indulgent. True to its origins, my version uses salted butter, with an added pinch of flaky salt to sharpen the flavour. It also takes a small detour from tradition: a slick of marmalade brings a fragrant bitterness, while a handful of ground almonds softens the overall richness and lends a tender crumb. The result is still buttery and luxurious, but with a brighter, more aromatic edge.Brief stints in the freezer help firm up the dough between layers, making it easier to spread the marmalade without disturbing the base