The share price of Microsoft (NASDAQ: MSFT) cratered last week -- down 11% on Thursday, the largest one-day drop in the tech giant's stock since March 2020. Shares rebounded a tiny bit in the afternoon to end 10% down on the day. What's going on? And what should investors expect now? Microsoft released results Thursday morning for its fiscal second quarter, ended Dec. 31, 2025. Based on the headline numbers, you would have expected a great reaction from Wall Street. Revenue of $81.3 billion in the quarter ...

Microsoft's (MSFT) stock lost 12% on Thursday. It’s now down 22% from its July 2025 all-time high of $555.45. While the mega-cap’s quarter was a good one -- revenues and earnings were $1.0 billion and 23 cents higher, respectively, than Wall Street’s estimates -- its guidance for the future was softer than expected, prompting the big selloff. More News from Barchart Interestingly, despite Microsoft saying its Azure cloud computing business would see 38% revenue growth in Q3 2026, investors don't feel i ...

Investment management company Vulcan Value Partners recently released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. All the strategies of Vulcan Value Partners delivered positive results in the year. The Large Cap Composite (Net) returned -1.5% in Q4 and 7.9% YTD, the Small Cap Composite (Net) gained 3.2% in Q4 and 9.5% YTD, The Focus Composite (Net) retuned 0.1% in Q4 and 7.1% YTD, Focus Plus Composite (Net) returned 0.1% in Q4 and 6.2% YTD and the All-Cap Composite ...

Microsoft Corporation (NASDAQ:MSFT) is among the 12 Best Performing Dow Stocks in 2025.  Morgan Stanley Analyst Keeps A Buy Rating On Microsoft Corporation (MSFT) Morgan Stanley analyst Keith Weiss reaffirmed a Buy rating on Microsoft Corporation (NASDAQ:MSFT) and set a price objective of $650 on December 8, 2025. Further developments followed on December 9 from theFly, where Jefferies stated that OpenAI’s hiring of Denise Dresser, the CEO of Slack, as its new CRO positions the company for a major enter ...

Core Viewpoint - The Gates Foundation Trust is significantly reducing its Microsoft stock holdings, raising questions about the implications for Microsoft shareholders and the broader AI investment landscape [2][10]. Company Summary - Microsoft remains the largest holding in the Gates Foundation Trust, which is valued at nearly $50 billion [1]. - The trust has been a net seller of Microsoft stock for several quarters, although it made a substantial purchase of nearly 40 million shares in 2022 [8]. Industry Summary - The stock market is currently considered expensive, with the S&P 500 trading at over 30 times earnings, which is approximately double its long-term average [3]. - The AI sector is projected to grow at an annual rate of 30% through 2033, creating significant value and opportunities for companies involved in AI technology [4]. - Microsoft is positioned as a key player in the AI sector, providing essential services through its Azure cloud computing division, which supports AI model training and deployment [5]. - Microsoft stock is trading at nearly 13 times sales, a valuation not seen since the dot-com bubble, indicating that while AI potential justifies high valuations, the stock is expensive relative to its historical trading patterns [6].

Core Insights - Microsoft Corp is experiencing its longest losing streak in over a decade due to growing caution in the artificial intelligence sector impacting major technology stocks [1] - The company's stock has dropped 8.6% over the past eight trading days, resulting in a loss of nearly $350 billion in market value [2][9] - Investor sentiment has turned cautious despite better-than-expected growth in Microsoft's Azure cloud computing division, primarily due to concerns over heavy spending on AI infrastructure [3][8] Financial Performance - Microsoft reported $34.9 billion in capital expenditures for the quarter, with indications that spending will increase in the current fiscal quarter [4] Market Trends - The broader market is also affected, with the Nasdaq 100 Index and the Bloomberg Magnificent 7 Total Return Index both declining about 4% this week, marking their largest one-week drop since April [6] - In contrast, Apple Inc shares rose by 0.9%, as the company has adopted a more measured approach to AI investments, becoming a relative safe haven amid the ongoing weakness in the AI sector [7]

Core Viewpoint - Wall Street analysts are overwhelmingly bullish on Microsoft Corp., with nearly 99% recommending to buy the stock following Guggenheim's upgrade to buy from hold ahead of quarterly results [1][2]. Group 1: Analyst Upgrades and Recommendations - Guggenheim's upgrade reflects optimism regarding Microsoft's ability to leverage artificial intelligence advancements, positioning it as a beneficiary in the current market [2]. - Among the 73 analysts tracking Microsoft, only Hedgeye Risk Management maintains a neutral rating, with no analysts recommending to sell the stock [1]. Group 2: Market Performance and Price Target - Microsoft's shares increased by 1.3% in premarket trading and have risen 24% this year, outperforming the Nasdaq 100 Index's gain of approximately 21% [3]. - Guggenheim set a price target of $586 for Microsoft, indicating a potential upside of about 12% from the stock's last closing price [3]. Group 3: Upcoming Earnings and Investor Focus - Investors are anticipating Microsoft's first-quarter results on October 29, with a focus on AI-related growth trends and insights into the company's spending plans [3].

Group 1 - Microsoft surpassed $4 trillion in market valuation, becoming the second publicly traded company to achieve this milestone after Nvidia [1] - The company forecasted a record $30 billion in capital spending for the first quarter of the current fiscal year to address increasing AI demand and reported strong sales in its Azure cloud computing business [1][7] - Microsoft's stock price increased by 4.5% to $536.47 following the earnings report [1] Group 2 - The company is transitioning to a cloud infrastructure business and a leader in enterprise AI, generating profits despite significant AI capital expenditures [2] - Microsoft's valuation growth to $3 trillion was more gradual compared to Nvidia and Apple, with Nvidia reaching $4 trillion first [3] - The company's investment in OpenAI has significantly enhanced its Office Suite and Azure offerings, contributing to a doubling of its stock value since the launch of ChatGPT in late 2022 [4] Group 3 - Meta Platforms is also increasing its AI investments, forecasting third-quarter revenue that exceeded Wall Street estimates, indicating a competitive race in AI among tech companies [5] - Wall Street's confidence in Microsoft has surged following consecutive record revenues since September 2022 [6] - The company's stock rally was supported by workforce reductions and increased AI investments, showing resilience against potential impacts from US tariffs [8]

Core Insights - Microsoft shares increased over 6% following a strong earnings report, driven by AI and cloud growth [1] - The stock has risen 21% year-to-date and nearly 30% since April [1] Financial Performance - Earnings per share (EPS) of $3.65 exceeded expectations of $3.35, marking a 23% year-over-year increase [3] - Total revenue reached $76.44 billion, surpassing expectations of $73.81 billion, and was 18% higher year-over-year [4] - Azure cloud computing revenue grew by 39%, up from 34.4% in FY 2024, with total Azure revenue reported at $75 billion for the full year [4] Capital Expenditures - Microsoft reaffirmed its forecast for $60 billion in capital expenditures, primarily driven by AI investments [5] Analyst Ratings and Price Targets - Dan Ives of Wedbush raised the price target for Microsoft stock to $625 from $600, indicating a potential 15% gain from the current price [6] - The average 12-month stock price forecast is $596.82, suggesting a 10.88% upside [7] Market Trends - Microsoft stock is in a sustained uptrend, characterized by higher highs and higher lows since late April [9] - Indicators suggest potential slowing momentum, with the MACD line narrowing and the RSI over 70, indicating overbought conditions [10] Investment Strategies - Investors may consider waiting for the RSI to dip below 65 or for the stock price to retest the 50-day simple moving average before taking long positions [11] - A bullish call spread strategy is suggested for traders looking to capitalize on current price action [12]