Microsoft (MSFT, Financial) recently joined Apple as the only companies with market capitalizations in excess of $2 trillion. This has been fueled in part by the success of its Azure cloud business; which posted revenue growth of 50% in the most recent quarter.7 Notably, Azure’s areas of emphasis—platform as a service (PaaS) and software as a service (SaaS)—tend to have higher margins than infrastructure as a service (IaaS).
From First Eagle Investmetn Fund of America's third-quarter 2021 commentary.
