What a quarter.

Microsoft (MSFT - Get Report)  reported better-than-expected earnings and revenues in the fiscal third quarter, with CEO Satya Nadella telling investors that cloud computing and digital transformation of corporations drove results, after the market close Thursday.

"The intelligent cloud and intelligent edge era is already upon us," Nadella said during the earnings call, naming Coca Cola (KO - Get Report) as a recent win for Microsoft's cloud products.

The Redmond, Wash., tech group earned 95 cents per share on the quarter, topping forecasts of 85 cents per share, according to FactSet. Revenue of $26.8 billion beat expectations of $25.8 billion.

Shares gained 3.5% in pre-market trading. 

Microsoft's Azure cloud unit was the fastest-growing business, with a 93% gain in revenues. Growth was down from 98% in the prior quarter, however.

Microsoft is a holding in Jim Cramer's Action Alerts PLUS.

Nadella highlighted the performance of Microsoft's relatively new Cosmos DB database product. Cosmos DB allows cloud customers users to scale storage up or down at data centers in Microsoft's 50 geographic regions around the world, which Nadella said is the most regions of any cloud computing company.

Microsoft CEO Satya Nadella.
Microsoft CEO Satya Nadella.

"I've never seen a product that has gotten to this kind of scale this quickly," Nadella said of Cosmos DB.

Microsoft's core enterprise applications also had strong growth. Microsoft Dynamics 365 customer and resource management software grew 65% and Office 365 Commercial sales gained 42%.

Social network LinkedIn grew 37% in the quarter. "We saw record levels of engagement," Nadella said, with demand for sponsored content and job postings driving growth.

A little more than a year after Microsoft closed the $26.9 billion pruchase of Linkedin, CFO Amy Hood said the appetite and capacity for acquisitions has not diminished. "I feel quite good that we don't worry about our ability to do them ," she said, " but I wouldn't say that's new this quarter."

Microsoft has resources to strike more deals. The company reported ust over $132 billion in cash at the close of the quarter, down from nearly $133 billion a year earlier.

Nadella played up Microsoft's security efforts, as concerns about data privacy casting a shadow over Silicon Valley and the EU's enacts new General Data Protection Regulation rules next month.

Privacy is a "a fundamental human right," Nadella said.

Microsoft has been preparing for GDPR since 2016, Nadella said, and would provide contractual commitments to help users comply with the new regulations. The company signed a cybersecurity accord with 34 global tech companies to improve Internet security. The company also set up an internal committee to make sure that it develops artificial intelligence in an"ethical and responsible" way.