Citi, in its report, upheld a constructive view on Microsoft (MSFT.US), expecting Azure to accelerate growth in 2HFY26. However, in wake of slightly lower non-Azure 2026 estimates on weaker PC demand, and increased spending related to OpenAI, the company's target price was cut from USD690 to USD660. The rating was Buy.

Distributor surveys showed a slight dip in Microsoft's quarterly results performance, but partner and CIO surveys were more optimistic, highlighting Azure's sustained momentum and strong order pipeline, Citi noted.

Despite potentially mixed 2Q results, Citi remained constructive about Microsoft's 2H results, as strong orders and expanded capacity are expected to juice Azure's accelerated growth and lead to upward forecast revisions.

Microsoft remains a top pick among mega-cap tech stocks, with the multiple avenues of high-ROI AI monetization pathways expected to drive continued acceleration in revenue and profit growth.
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AASTOCKS Financial News
URL: www.aastocks.com

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