Microsoft Enjoys 'First-Mover Advantage' As AI Revenue Doubles, 5 Analysts Explore Q2 Print
Portfolio Pulse from Priya Nigam
Despite Microsoft Corp (NASDAQ:MSFT) reporting higher-than-expected quarterly results with significant growth in AI revenue, shares fell in early trading on Wednesday. Analysts from BMO Capital Markets, RBC Capital Markets, Piper Sandler, Truist Securities, and William Blair provided positive outlooks, with some raising their price targets due to strong Azure growth, particularly in AI workloads. AI-related revenue doubled sequentially, and although it represents a small portion of total revenue, it's seen as a key growth driver. Analysts expect AI to continue contributing to growth throughout the year.
January 31, 2024 | 5:10 pm
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Microsoft's Q2 results exceeded expectations with AI revenue doubling, yet shares dropped. Analysts remain positive, raising price targets and highlighting Azure's AI growth as a significant factor.
The positive analyst ratings and increased price targets suggest confidence in Microsoft's growth prospects, especially in AI and Azure services. Although the stock dipped, the strong fundamentals and optimistic outlook from analysts could lead to a positive short-term impact on the stock price.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100