Microsoft’s profits continue to climb.

Microsoft announced record profits and sales on Tuesday, although investors feared that the epidemic-driven tech boom could be over.

Microsoft, the first of the largest tech companies to report quarterly earnings for the month of December, said its sales were $ 51.7 billion, up 20 percent from a year earlier, and profits rose 21 percent to $ 18.8 billion. The company saw particularly strong growth in its cloud services as it locked up long-term customer deals.

Although it beat Wall Street expectations, the company’s shares were down nearly 5 percent in aftermarket trading but returned the day after. The decline was largely due to the panic in the stock market and some of the downside results for bullish investors.

In a call with investors, executives shared optimistic outlook for the next quarter, pushing Microsoft’s share price higher. Satya Nadella, chief executive of Microsoft, said demand for services was still strong.

“Coming out of the epidemic we are seeing really many obstacles in the economy, and the only resource that can help increase productivity by keeping costs down is digital tech,” he said.

Microsoft had $ 125 billion in cash, of which about $ 70 billion it expects to spend on video game powerhouse activation in a deal announced this month. Bank of America analysts called the purchase a “sensible maneuver” and a “strategic and financially positive” move that could boost Microsoft’s gaming business on a number of platforms.

Sales of Microsoft’s cloud offerings to commercial customers, including Office 365 subscriptions and Azure, its cloud computing platform, rose 32 percent to $ 22.1 billion. Office 365, which includes the Word and Teams Communications app, will be launched in March, so revenue is set to grow further. According to Wadebush Securities, the price increase could generate an additional 5 billion in revenue this year.

Azure is the second largest cloud platform after Amazon web services. It’s part of a fundamental shift in how companies are moving their business online. Azure grew 46 percent, showing how consumers across the industry are signing bigger, longer deals.

Brett Eversen, head of investor relations at Microsoft, said that despite the turmoil in the stock market, the company was focusing on long-term opportunities so that it could reduce “short-term, external noise that we do not control.”

Mr. Iversen said Microsoft’s Windows business was particularly strong, with sales increasing 25 percent as corporate customers bought new computers for their employees.

Despite a shortage of chips limiting the supply of new Xbox consoles during the festive season, the company’s gaming business grew 8 percent, part of its personal computing segment, to 15 percent to $ 17.5 billion.

The so-called great resignation among workers also gave rise to the professional social network, LinkedIn, which increased revenue by 37 percent.

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