Microsoft’s stock price soared 14% ahead of the company’s earnings release. Investors are focused on Azure growth and AI monetization as the company strengthens access to Copilot and launches new bundles.
Microsoft shares closed Friday’s trading at 359.55 euros, capping a weekly gain of about 14%. The rally, the first stock increase since 2007, sets the stage for the company’s third-quarter earnings report, which will be released after the market closes on April 29. Investors are looking for concrete signs that the software giant’s large-scale artificial intelligence investments are leading to sustainable returns.
The recent gains come amid a significant strategic increase in Microsoft’s access to AI. Since mid-April, the company has implemented stricter licensing rules, locking unlicensed users in large Microsoft 365 environments from Copilot functionality in applications such as Word and Excel. The move marks a decisive step toward monetizing multibillion-dollar AI investments and marks the end of free access to advanced AI tools.
Analyst scrutiny and diverse views
The upcoming report will focus on two key metrics: growth in the Azure cloud segment and capital spending dedicated to building AI infrastructure. Bernstein analysts remain bullish, reiterating their “outperform” rating with a price target of $641. They argue that the lag between infrastructure investment and revenue growth is a matter of timing, with new capacity typically monetized within six months. They predict Azure growth will accelerate in Q3 and Q4.
Not everyone shares this optimism. BNP Paribas also maintained its rating of “outperform,” but significantly lowered its price target from $659 to $556. The company expects third-quarter intelligent cloud revenue to be between $34.1 billion and $34.4 billion. For Azure, we are targeting growth of 37-38 percent on a constant currency basis, a slight deceleration from the 39 percent recorded last quarter.
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Monetization efforts and market expansion
In addition to restricting access, Microsoft is actively pursuing widespread adoption. The new discount tiers in the Cloud Solution Provider Program are designed to lower the barrier to volume discounts, making AI tools more affordable for small and medium-sized businesses, specifically targeting the mid-market. Bank of America estimates that Copilot had about 15 million paying users last quarter, representing about 3.5% of the commercial Microsoft 365 user base. Internally, Microsoft is said to have met its ambitious revenue targets for the March quarter, with head of commercial Judson Althoff acknowledging that “aggressive” targets had been met.
Large-scale product launches could further accelerate this monetization. Starting in May, Microsoft will begin selling Microsoft 365 E7, a new bundle that combines M365 E5, Copilot, and additional enterprise tools.
Underlying challenges and institutional support
Despite weekly gains, the technical situation reveals fundamental challenges. At around €360, the stock is still well below its 200-day moving average of around €405 and still about 23% off its 52-week high. However, sentiment among analysts is overwhelmingly positive. Of the 49 covering analysts, 41 recommend a “strong buy,” four recommend a “moderate buy,” and four recommend a “hold.”
Institutional research provides further support. Morgan Stanley’s Q1 2026 CIO Poll found that 32% of IT decision makers expect Microsoft to capture the largest share of incremental AI spending this year. For agent automation projects, 42% plan to use Microsoft.
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The company released an update this week that also addresses serious security concerns and patches 165 vulnerabilities. One of the actively exploited zero-day vulnerabilities in SharePoint was immediately added to the U.S. Cybersecurity and Infrastructure Security Agency’s (CISA) catalog of known threats.
Next week will determine whether Microsoft’s aggressive efforts to turn its AI capabilities into profits can justify both its recent stock price rally and its ongoing heavy investment. This earnings release will be a decisive test of the market’s confidence in Satya Nadella’s AI roadmap.
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Microsoft Stock: New Analysis – April 19th
The latest information from Microsoft has been released. What are the implications for investors? Our latest independent report examines recent numbers and market trends.
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