Banking giant updates Microsoft stock price target

Core Viewpoint - A banking giant, Goldman Sachs, maintains a Buy rating on Microsoft (NASDAQ: MSFT) with a price target of $600, indicating confidence in the company's long-term growth despite current price declines [1][2]. Group 1: Stock Performance and Analyst Ratings - The reaffirmed price target of $600 represents a projected upside of approximately 55% from Microsoft's current value of $389, despite a year-to-date drop of over 15% [2]. - Wall Street analysts remain bullish on MSFT, with a consensus rating of 'Strong Buy' from 36 analysts, where 33 recommend buying, three suggest holding, and none recommend selling [7][8]. - The consensus 12-month price target is $594.02, implying a potential upside of 52.88%, with a high-end target of $678 and a low estimate of $392 [8]. Group 2: Technological Developments - The positive outlook follows Microsoft's announcement of the Maia 200 AI inference accelerator, which is designed to enhance AI workloads and reflects progress in the company's internal chip development [4]. - The Maia 200's performance is reportedly becoming competitive with other solutions, which could improve Microsoft's AI compute price-to-performance positioning within Azure [5]. - Enhanced efficiency at the silicon level may help Microsoft achieve AI compute gross margins similar to traditional CPU-based cloud workloads, thereby strengthening profitability in its cloud segment [5]. Group 3: Risks and Challenges - Execution risks are present, as large-scale production benchmark data for the Maia 200 has not yet been fully demonstrated, and successful manufacturing ramp-up is essential for broader rollout [6]. - Expanding software ecosystem support, including developer tools and inference engines, is critical for maximizing adoption of the Maia 200 [6]. - The competitive landscape is rapidly evolving, with rival accelerator programs advancing, which could pose challenges for Microsoft [6].