Microsoft Corp. beat earnings expectations in sales for its first fiscal quarter, thanks in no small part to meeting its own self-imposed goal of reaching $20 billion in annual cloud revenue.

The software and cloud giant’s shares rose about 4 percent in after-hours trading as a result. Update: In Friday trading, shares were rising more than 7 percent.

Microsoft reported a profit of 84 cents per share, up 17 percent from a year ago, beating out analyst predictions of a 72-cent profit, and logged revenue of $24.5 billion, up 12 percent and exceeding analysts’ expectations of $23.56 billion.

Something Microsoft can be proud of is the report that the company exceeded its goal of $20 billion in annualized revenue run rate for its commercial cloud business, which includes Azure cloud, the Office 365 productivity suite and Dynamics 365, the company’s enterprise resource planning and customer relationship management tool. In fact, it accomplished that feat almost a year early.

“This quarter we exceeded $20 billion in commercial cloud ARR, outpacing the goal we set just over two years ago,” Satya Nadella (pictured), chief executive officer at Microsoft, said in a statement.

Microsoft has also maintained its $600 billion market cap, closing today at $607.67 billion. This is significant because the company exceeded this market cap again recently, which is a number that the software giant has not seen since the peak of the dot-com boom in 2000.

According to the earnings report, Microsoft saw an increase of 28 percent in revenue from productivity and business processes with $8.2 billion. This includes office commercial products and cloud services, up 10 percent, driven by Office 365 subscriptions and a commercial revenue growth of 42 percent. Office consumer products increased by 12 percent and Office 365 consumer subscribers increased to 28 million. Dynamics products and cloud services revenues increased by 13 percent, driven by Dynamics 365 revenue growth of 69 percent.

LinkedIn, a social-messaging service for professionals acquired by Microsoft for $26.2 million in June 2016, also contributed revenue of $1.1 billion during the quarter.

“We are seeing record levels of engagement, LinkedIn is on target to surpass 21 billion sessions this calendar year and has seen its fourth consecutive quarter of twenty percent plus sessions growth,” Nadella said in the earnings call. “Engagement across the platform is strong with 65 percent year-over-year growth in jobs. Visitors across mobile and desktop, 60 percent growth in feed update views and nearly 40 percent growth in messages sent driven by more ubiquitous messaging.”

Intelligent Cloud revenue was $6.9 billion and increased by 14 percent. Within Intelligent Cloud, server products and cloud services revenue increased 17 percent driven by Azure revenue growth of 90 percent. Although enterprise services revenue increased by 1 percent with growth in Premier Support Services offset by declines in custom support agreements.

Personal computing raised $9.4 billion in revenue for Microsoft and remains relatively unchanged, this department includes its Windows, Surface PC and Xbox businesses. Windows consumer revenue increased by 4 percent, which is ahead of the overall personal computer market. Windows commercial licensing and cloud services revenue increased by 7 percent. In advertising, Microsoft reported a 15 percent revenue increase — excluding traffic acquisition costs — which the report says is driven by higher revenue per search and search volume.

Surface revenue increased by 12 percent driven by sales of the new Surface Laptop. As for the Xbox division, revenue increased by only 1 percent, Xbox software and services revenue growth saw an increase of 21 percent offset by lower hardware revenue.

Looking at Microsoft’s past year, the company pushed heavily on its cloud business, including Microsoft Azure – which saw a revenue rise of 97 percent year-over-year last quarter. Credit Suisse analysts Michael Nemeroff, Alexander Hu and Christopher Rochester weighed in with a statement showing expectations of strength in its commercial cloud business.

Analysts from KeyBlanc Capital Markets wrote in a research note this week that consumer adoption of the cloud market would be a primary driving factor for Microsoft earnings.

“We have been impressed by solid execution and strong customer adoption of Microsoft’s cloud applications and platforms,” KeyBanc analyst Brent Bracelin wrote. “Reaching $20 billion would imply the commercial cloud mix could cross over 20% of revenue for the first time in the first quarter of fiscal 2018, up from 5% in early 2015. … Similar to the multiyear transition at Adobe Systems Inc., we still view Microsoft in the early innings of cloud migration.”

Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, said the company’s modernization efforts and reach into the cloud show impressive growth.

“Azure grew an incredible 90 percent, doubled compute usage, and tripled premium services,” Moorhead told SiliconANGLE. “Productivity and Business Process business grew 28 percent by a 32 percent growth in Office 365 commercial seats, 12 percent Dynamics growth, and even a 10 percent improvement in consumer.  Personal computing revenue was flat with some puts and takes.

Moorhead also called out hardware. “Surface, Windows, Xbox software and services and Search saw improvements but were offset by the tail end of getting out of the phone business.” he noted. “It was good to see Surface grow 12 percent and is a testament to their Surface Laptop launch, which pulled Microsoft into the mainstream PC market, competing head-to-head with premium Apple products.”

The results also indicate that Microsoft is becoming even more of a force in the enterprise than with consumers, he added: “Microsoft has cranked out an impressive array of growth the past few quarters and I’m convinced that more and more businesses are looking to the company to modernize their businesses as the company is focused on businesses, not consumer services.”

Pund-IT Inc. Principal Analyst Charles King said he was impressed with the cloud performance. “That’s impressive, even in an IT market where cloud-based services and solutions have become commonplace among businesses and consumers,” he said. “It also means that Microsoft is continuing to give Amazon’s AWS a literal run for its money in public cloud market leadership.”

During today’s analyst call with Microsoft bigwigs, Nadella spoke a lot about the company’s approach to what is called “intelligent cloud” and the use of artificial intelligence.

After touting the use of artificial intelligence across the Office 365 line of Microsoft products, Nadella spoke to how Microsoft is bringing all of this computational power to the hybrid cloud to generate more focused value propositions.

“We have been focused on addressing the real-world needs of customers with our differentiated approach to the cloud, architecting for hybrid consistency, developer productivity, AI capability and trusted security and compliance,” Nadella said. He noted that the vision for Azure and other cloud products is to provide operational capability that covers the entire digital estate and enables the use of AI in business, adding, “Our hybrid cloud is the reason why nearly every Fortune 500 company has chosen to partner with Microsoft.”

During the call, for every business department Nadella mentioned, he was quick to turn the discussion back to Azure and the cloud. Including during a segment on the Xbox and gaming department where he mentioned that Azure cloud is being built into Xbox and gaming development so that developers can take advantage of cloud graphical processing and business intelligence even after games have been published.

Nadella also boasted that Microsoft’s current trajectory for building Azure cloud data centers now brings Azure regional access to 42 regions globally — a number, he was quick to say, that’s more than what any other cloud provider has.

Photo: Fortune Brainstorm Tech via Flickr CC