Microsoft (MSFT, Financial) also contributed to performance during the quarter. Revenues grew +10% (foreign exchange adjusted) whereas operating income grew +14%, helped by +18% growth in Office365 and 31% growth in Azure and other cloud services. Although the Company guided to a deceleration in its core businesses, Microsoft has ample opportunity to drive attractive double-digit growth over a multi-year timeframe. We recognize investors have disproportionately favored software and tech stocks year to date, driving multiples to relative and historical highs. As a result, we paired some of our weighting in Microsoft earlier in the year; however, it remains a core position in portfolios.
From David Rolfe (Trades, Portfolio)'s Wedgewood Partners second-quarter 2023 letter.