Analyst Says Microsoft (MSFT) at ‘Intersection’ of Software and AI

Core Insights - Microsoft Corporation (NASDAQ:MSFT) is recognized as a leading AI and non-tech stock, with expectations of achieving mid-30% growth in its Azure segment [1][2] - The company reported a significant 40% year-over-year growth in Azure, surpassing analyst expectations, although its capital expenditures (CapEx) reached approximately $35 billion, exceeding forecasts [2] Financial Performance - Microsoft has invested heavily in capital expenditures, establishing over 2 gigawatts of data center capacity in the past year, resulting in a gross property, plant, and equipment value of nearly $370 billion [4] - The gross cash flow increased from $60 billion in 2020 to over $140 billion in 2025, indicating a strong return on capital in the high 20s percentage range [4] Market Position - Microsoft is positioned at the intersection of software and AI, contributing to its consistent growth and value addition in the market [2][3] - Despite the strong performance, some analysts believe that other AI stocks may offer higher returns with lower risk compared to Microsoft [4]