10 Most Profitable Large Cap Stocks to Buy Now

3. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 317

Last year net income: $88.14 billion

Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops software, cloud computing solutions, and hardware products. Its core offerings include the Windows operating system, Microsoft 365 productivity suite, and Azure cloud platform. The company also provides enterprise solutions, gaming through Xbox, and professional networking via LinkedIn. MSFT serves businesses, governments, and consumers worldwide, offering AI-powered services, cybersecurity tools, and developer platforms. It operates across multiple industries, delivering digital transformation solutions through software, cloud infrastructure, and computing devices.

Microsoft Corporation (NASDAQ:MSFT) reported strong performance in the latest Q2 with 75% constant currency bookings growth and significant Azure AI contracts. The company’s AI revenue primarily comes from inference and post-training workloads, along with Copilot revenue, totaling $13 billion. MSFT is experiencing capacity constraints in AI infrastructure but expects supply and demand to be in balance by the end of fiscal year 2024. The company is making significant investments in long-term data center assets, with plans to shift towards more server-focused investments once the global footprint is established. Microsoft 365 Copilot deployment exceeds expectations, with customers who initially purchased buying and using more, demonstrating faster adoption than previous enterprise products.

The partnership with OpenAI remains strategically important through 2030, with Microsoft Corporation (NASDAQ:MSFT) maintaining its position as their primary partner. The company is focused on building a flexible, global AI platform through Azure that can serve all types of workloads, positioning it for long-term growth. Despite some execution challenges in non-AI workloads, MSFT continues to see strong demand for both AI and traditional cloud migrations. The company is experiencing improved margin outlook for FY2025, driven by both AI-related efficiencies and operational cost management. With $88 billion net profit generated in FY2024, MSFT is one of the most profitable large cap stocks to buy now.