Microsoft shares rose about 5% to an all-time high today, after investors cheered another blockbuster quarter, backed by growth in its legacy software business and Azure cloud computing services.
Shares of one of the technology world's oldest and best-known names rose to $108.20 in early trade on Wall Street.
This added more than $30 billion to a market capitalisation that was already $802 billion at yesterday's close.
At least six brokerages raised their price targets on the company's stock after the results.
Helped by a boom in demand for cloud-based software, Microsoft has more than doubled in value since Satya Nadella took over as chief executive in 2014 and refocused the software giant on newer businesses.
While Microsoft's core productivity and business processes unit, which includes the Office 365 software suite, rose 13.1% to $9.67 billion, revenue for the Azure cloud service jumped 89%.
Microsoft has been investing heavily to bolster the fast-growing cloud business and catch up with market leader Amazon.com's Amazon Web Services (AWS).
Microsoft also competes with Alphabet's Google, IBM and Alibaba.
According to research firm Canalys, AWS is beating the competition in terms of market share, followed by Microsoft, which continues to grow faster than AWS, as of April this year.
Google was ranked third.
"Our early investments in the intelligent cloud and intelligent edge are paying off, and we will continue to expand our reach in large and growing markets with differentiated innovation," Nadella said on a conference call.
Analysts expect the investments to pay off in the long run and provide rich dividends to shareholders, allowing Microsoft to rival Apple and Amazon in the race to be the first company worth $1 trillion.
Microsoft said its net income increased 10% to $8.8 billion on revenue that was up 17% to $30.1 billion compared to the same time last year.
It saw revenue gains across its full range of businesses including business services, gaming, internet search ads, its consumer software including Windows and Office and LinkedIn, the recently acquired professional social network.
"We had an incredible year," chief executive Satya Nadella said in a release.
"Our early investments in the intelligent cloud and intelligent edge are paying off, and we will continue to expand our reach in large and growing markets with differentiated innovation," he added.
Revenue in a productivity and business processes category that included career-focused social network LinkedIn was up 13% in the quarter to $9.7 billion, according to Microsoft.
LinkedIn revenue increased 37% as usage soared, the earnings release indicated. Microsoft bought LinkedIn two years ago in a deal valued at $26.2 billion.
The company reported net income of $16.6 billion for the fiscal year on revenue that rose 14% to $110.4 billion.
In one major deal announced this week, Microsoft and Walmart unveiled a strategic partnership to help the retail giant ramp up its efforts against Amazon.
Microsoft has announced technology partnerships with other major firms in recent months including General Electric, Starbucks, Bayer, Telefonica and sports organizations such as the NBA and PGA.
The moves into business services and cloud computing has reduced Microsoft's dependence on Windows, the dominant software for personal computers that has been overtaken in the consumer market by mobile devices powered by Google or Apple software.