Citi Lowers Its Price Target on Microsoft (MSFT) from $690 to $660, Reiterates a ‘Buy’ Rating

Core Viewpoint - Microsoft Corporation (NASDAQ:MSFT) is recognized as a long-term investment opportunity, despite recent adjustments in price targets and ongoing legal challenges [1][2][4]. Group 1: Price Target and Market Sentiment - Citi has lowered its price target for Microsoft from $690 to $660 while maintaining a 'Buy' rating, indicating a cautious outlook for the short term due to mixed reseller surveys and weaker PC demand [2]. - The reduction in estimates particularly affects Microsoft's non-Azure businesses, reflecting concerns over current market conditions [2]. Group 2: Azure and Growth Prospects - Azure is anticipated to exceed expectations in the upcoming fiscal Q2, serving as the primary earnings driver for Microsoft, which remains a top mega-cap investment idea [3]. - The company's diverse revenue streams from software, cloud services, and devices, particularly through its Azure platform, are crucial for sustained growth [5]. Group 3: Legal Challenges - Elon Musk is pursuing claims against OpenAI and Microsoft, alleging entitlement to wrongful gains from his early support of OpenAI, with Microsoft potentially benefiting between $13.3 billion and $25.1 billion [4]. - Both Microsoft and OpenAI have dismissed these claims as baseless, and while a jury trial is set for April, there is currently no immediate operational impact on Microsoft [4].