Not sure how your clients will consume your digital content? Don't worry -- cloud platforms like Windows Azure can serve all of them. Image: Windows Azure.

What: Microsoft (NASDAQ:MSFT) shares rose as much as 11.6% on Friday. The technology giant's stock set fresh multi-year highs in the process, trading at prices not seen since the spring of 2000.

So what: On Thursday night, Microsoft reported results for the first quarter of its 2016 fiscal year. Analysts were looking for adjusted earnings of roughly $0.58 per share on something like $21.0 billion in top-line sales. Microsoft edged past the revenue consensus with a $21.7 billion revenue performance and crushed the Street's earnings targets with adjusted earnings of $0.67 per share.

Sales declined 6.4% year over year while earnings inched 3% higher.

Now what: According to CEO Satya Nadella, customer demand for Microsoft's most important products is surging across the board. "Customer excitement for new devices, Windows 10, Office 365 and Azure is increasing as we bring together the best Microsoft experiences to empower people to achieve more," Nadella said in a press statement.

The intelligent cloud division, led by cloud computing platform Windows Azure, delivered 14% constant-currency sales growth. Within the intelligent cloud operation, on-premise software sales declined 8% while pure cloud service revenues soared 70% higher. That segment collected $5.9 billion in first-quarter sales.

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

These are impressive numbers, proving that Microsoft has a solid business case for going after the cloud computing market. However, Microsoft investors should also keep an eye on the competition. (NASDAQ:AMZN) also reported results on Thursday night, including $2.1 billion of Amazon Web Services revenue.

Importantly, Amazon's cloud sales are keeping pace with Microsoft Azure's growth, rising 78% year over year. So you're not watching Microsoft steal the lunch right off Amazon's plate, but two emerging giants growing their unique visions of cloud computing side by side. In short, there's plenty of room for two (or more!) strong competitors in the burgeoning cloud market.