Microsoft

By Brian Swint Microsoft, one of the three biggest companies by market capitalization, is only just starting to reap the benefits of artificial intelligence. That’s the view of analysts at Wedbush led by Dan Ives, who raised their price target to $550 from $500 in a note published Sunday and maintained an Outperform rating. While Ives is known for his bullish views on technology stocks, the analysts have based their stance on research conducted with Microsoft customers for insight into their future spending plans. “The stock still has yet to price in what we view as the next wave of cloud and AI growth coming to the Redmond story with a strong competitive cloud edge vs. Amazon especially and Google,” said Wedbush. “It has become crystal clear to us that the monetization opportunities around deploying AI and ChatGPT in the cloud is a transformational opportunity.” Microsoft mainly uses AI in […]

Microsoft’s (MSFT) trajectory for growth and leading position in artificial intelligence is encouraging, RBC Capital Markets said in a note Friday. “Microsoft continues to invest aggressively in AI, given the market opportunity and its early leadership,” RBC said. This strategy contrasts with Microsoft’s previous approach to cloud computing when it was competing with Amazon.com’s (AMZN) Amazon Web Services. Despite expected increases in capital expenditures that could impact profit margins, Microsoft is viewed as aligning with market demand and actively seeking to mitigate costs, RBC said. “Advances like GPT-4o, which is more efficient, and Maia (custom AI silicon) will help drive down the cost curve.” Additionally, cloud computing and Copilot feature show promise, while security and gaming also have growth opportunities. Microsoft’s strategic focus on software/services in gaming aims to enhance margins and reduce cyclicality. The company believes customers will build their own AI models, not just from scratch, but fine-tune

By Tom Dotan Microsoft said it is investing billions of dollars on artificial intelligence in Wisconsin, the latest stop in a global spending spree to build AI infrastructure and calm fears about the powerful technology. President Biden is scheduled to be in Mount Pleasant, Wis., on Wednesday along with Microsoft President Brad Smith to announce the $3.3 billion investment in a new data center there and training programs to educate locals about AI jobs in manufacturing. The announcement is the latest in a series of large investments the company has unveiled in the U.S., Europe and Asia to expand the reach of its AI network. Microsoft said the new site would initially create 2,300 construction jobs and eventually as many as 2,000 data center jobs. Microsoft said it is also investing in a new AI lab at the University of Wisconsin Milwaukee campus to train workers to use AI technology.

Microsoft’s (MSFT) collaboration with Conduent (CNDT) underscores the “unique AI leadership position” held by the software giant, Macquarie said in a report emailed Tuesday. Conduent on Monday announced an initiative with Microsoft aimed at using the Azure AI platform to improve healthcare claims management, customer service, and fraud detection. “We think Microsoft’s AI strategy uniquely positions it as the ultimate adoption beneficiary,” the Macquarie analysts said. Since its January 2023 investment in OpenAI, the company has steadily advanced its AI deployment, moving from testing to broader availability, Macquarie said, adding that “we view this recognition by Conduent as significant, as it highlights the importance of safety to a successful initial AI deployment.” Microsoft’s continued prioritization of its Azure platform has driven significant revenue growth, with Azure AI Services estimated at $4.1 billion in annualized run rate revenue, Macquarie said. Conduent plans to leverage Microsoft’s Azure AI platform across three pilots,

The following is a summary of the Microsoft Corporation (MSFT) Q3 2024 Earnings Call Transcript: Financial Performance: Microsoft reported $61.9 billion in revenue for Q3, a 17% increase from previous year’s period. They posted strong earnings per share of $2.94, a 20% increase year-over-year. Revenue gains were largely driven by Azure commitments, resulting in commercial bookings increasing 29% and 31% in constant currency. Microsoft’s cloud business recorded a revenue of $35.1 billion, growing at 23%, with gross margin percentage decreasing slightly to 72%. Operating expenses grew by 10%, with operating income increasing by 23%, and operating margins rising approximately 2 points year-over-year to 45%. Business Progress: Over 65% of Fortune 500 companies are now using Azure’s OpenAI service, indicating a growing business user base. Microsoft’s Copilot system is gaining traction, with plans to create Copilot-like scenarios in every business system to enhance enterprise-wide efficiency. Diablo IV’s integration into Game Pass

Technology giant Microsoft Corporation (NASDAQ:MSFT) reported third-quarter financial results that saw revenue and earnings per share beat estimates from analysts. Analysts are praising the company’s growth of artificial intelligence platforms. The MSFT Analysts: Oppenheimer analyst Timothy Horan has an Outperform rating and price target of $450. Raymond James analyst Andrew Marok has an Outperform rating and raises the price target from $450 to $480. Goldman Sachs analyst Kash Rangan has a Buy rating and raises the price target from $450 to $515. Morgan Stanley analyst Keith Weiss has an Overweight rating and price target of $520. Wedbush analyst Daniel Ives has an Outperform rating and price target of $500. Bank of America analyst Brad Sills has a Buy rating and price target of $480. JPMorgan analyst Mark Murphy has an Overweight rating and raises the price target from $440 to $470. BMO Capital analyst Keith Bachman has an Outperform rating and price

Microsoft (MSFT) latest Q3 results showcased yet another strong quarter with impressive outcomes across the board, Wedbush said in a report Friday. Microsoft Azure’s growth soared at 31%, surpassing both the Wall Street’s estimate of 29% and the company’s own guidance of 28%, driven by strong demand for their updated tech stack. “Copilot conversions continue exploding with partners/customers lining up for further Copilot deployments to increase efficiencies and profitable growth with more use cases seen across the product portfolio as the AI Revolution heats up,” Wedbush said. In Q3, Microsoft’s total revenues reached $61.86 billion, surpassing estimates, driven by successful AI integration, the firm said. Looking ahead, Microsoft anticipates solid revenue growth for Q4, “as more customers see increased use cases with MSFT’s AI technology stack to further expand profitable growth” while generating greater efficiencies across operations despite increasing investments, Wedbush said. Microsoft also issued robust guidance for 2025, anticipating

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We hold our 12-month target at $475 on a P/E of 33x our CY 25 view, above historical given AI growth trajectory and visibility. We raise our FY 24 (Jun.) EPS estimate to $11.89 from $11.74, adjust FY 25 to $13.22 from $13.43, and keep FY 26 at $15.39. MSFT posts Mar-Q EPS of $2.94 vs. $2.45, ahead of our $2.84 estimate. Sales rose 17%, above our view, led by Intelligent Cloud (+21%), More Personal Computing (+18%), and Productivity and Business Processes (+12%). Elevated Azure Cloud growth (31% vs. our 29% view) is sparking investor enthusiasm, with 7 points of growth from AI (near our forecast), while adoption from Microsoft 365 Copilot remains promising with a longer tail. MSFT Jun-Q guide was near expectations with sustained Azure

Microsoft (MSFT) will be a major beneficiary of incremental AI spending, according to a survey of chief information officers cited by Morgan Stanley in a Friday note. Morgan Stanley continues to see opportunity in Microsoft despite investor impatience with its topline results. “We continue to see room for further expansion,” according to the note. Particularly promising are Microsoft’s Azure, with the survey indicating that a net 39% of chief information officers expect to see Microsoft as the top AI budget share winner in 2024, Morgan Stanley added. Microsoft’s 365 Copilot is projected to contribute $5 billion to revenue in fiscal 2025, Morgan Stanley estimates, and $23 billion by fiscal 2029. While upcoming Q3 results will give investors some key data points on Azure growth, the other aspects of the Generative AI impact on Microsoft need several more business cycles. Still, Morgan Stanley sees Microsoft “positioned to sustain a 14% five-year

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We increase our 12-month target price to $475 from $455 based on a P/E of 33x our CY 25 view, above historical, as we see upside to forward expectations related to an improving AI growth trajectory/high visibility. We raise our FY 24 (Jun.) EPS estimate to $11.74 from $11.56 and FY 25 to $13.43 from $13.04. We start FY 26 at $15.39. Ahead of Mar-Q results expected on 4/23, we look for EPS of $2.84 on 15% revenue growth. We think all eyes will be on Azure, which we see growing 29%, with 6 to 8 percentage points of AI contribution. Any insights on Microsoft 365 Copilot adoption will also be monitored (first full quarter), as we do expect to hear positive commentary and see positive contribution

Microsoft’s (MSFT) “strong secular positioning” in tech, cloud and generative artificial intelligence should help the company double its earnings per share to $24 by fiscal 2029, Morgan Stanley said in a note Thursday. Given the company’s leading position, the business should be able to achieve a compound annual growth rate of 14% in revenue and 16% in earnings per share over the next five-year period, the firm said. Growth in the company’s earnings and revenue will be driven by its cloud business, while its first mover advantage in generative AI should further compound the gains. Morgan Stanley estimates the company’s revenue from its largest three generative AI initiatives could jump from around $5 billion in 2024 to almost $67 billion in 2029, and as much as $120 billion in a bullish scenario. The firm raised its price target to $520 from $465 on the company’s stock and maintained its overweight