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Microsoft is positioned to lead the cloud market, as Azure gains market share.
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Snowflake, with approximately 12,000 customers, currently has around half of them utilizing AI tools on its data cloud platform.
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10 stocks we like better than Microsoft ›
If you have some extra cash you’re looking to commit to a long-term investment plan, there’s never been a better time to start investing. Artificial intelligence (AI) is improving at an exponential rate, and investors stand to profit handsomely from holding the right AI stocks.
The following companies are leaders in cloud services and data management that could deliver excellent returns.
Microsoft (NASDAQ: MSFT) has been the dominant leader in software for decades, and it has translated that advantage to the cloud services market. Its impressive 39% year-over-year increase in Azure cloud revenue last quarter was faster than competitors, indicating significant market share gains.
Microsoft is second in market share behind cloud leader Amazon Web Services (AWS), but it’s growing more than twice as fast as AWS. Azure hauled in $75 billion of revenue in fiscal 2025 (ending in June). This indicates that Azure is winning large deals, as businesses increasingly turn to cloud services for building, deploying, and managing AI applications.
Microsoft’s lucrative software business gushes profits that it can spend on cloud and AI infrastructure. It logged $65 billion in capital expenditures last year, partly to expand its data center footprint across 70 regions worldwide. This puts Microsoft in a great position to provide cloud services globally with high-speed performance and low latency.
Moreover, the integration of cloud services through Microsfot Office software is also driving solid growth in its flagship software products. Its productivity software business reported revenue of $33 billion last quarter, representing a year-over-year increase of 16%.
Microsoft has multiple revenue streams from software, cloud, gaming, and advertising that make it a resilient buy-and-hold investment. Analysts expect the company’s earnings to grow at an annualized rate of 12%, which should send the stock to new highs in the coming years.
Growing AI demand is fueling robust investment in data infrastructure. This is benefiting several data intelligence companies like MongoDB, Datadog, and Databricks, which are reporting strong growth. Snowflake (NYSE: SNOW) has been reporting over 30% year-over-year quarterly revenue growth, as it continues to see strong demand for AI-driven tools on its platform.