TLDR
- Both Citi and Goldman Sachs hold Buy recommendations for Microsoft stock
- Second quarter revenue reached $81.3B, climbing 17% year-over-year; net income surged 60% to $38.5B
- Azure cloud platform expanded 39% annually; Copilot subscriptions jumped 160% to 15 million paying customers
- New Maia 200 processor now competes more effectively with Amazon and Google hardware
- Strong Buy ratings from 41 out of 50 Wall Street analysts; average price target stands at $595.60
Major investment firms continue showing confidence in Microsoft (MSFT), as both Citi and Goldman Sachs have recently reaffirmed their Buy recommendations on the tech giant.
Shares currently hover near $397 — representing a 30% decline from peak levels — though Wall Street’s consensus price target indicates potential upside to $595.60.
Citi’s Tyler Radke maintained his Buy stance following discussions with Microsoft’s investor relations division, emphasizing the company’s artificial intelligence strategy, cloud infrastructure expansion, and capital allocation plans.
Impressive Second Quarter Performance
Microsoft delivered second quarter revenue of $81.3 billion, reflecting 17% annual growth. Net profit soared 60% to reach $38.5 billion.
The company’s cloud business surpassed $50 billion in quarterly revenue for the first time, registering 26% year-over-year growth. Azure emerged as the primary driver, posting 39% expansion.
Paid subscriptions for Microsoft 365 Copilot hit 15 million seats, representing more than 160% growth from the previous year. Radke characterized this as a significant revenue catalyst for Microsoft’s enterprise software portfolio.
GitHub Copilot attracted 4.7 million paying subscribers, marking 75% annual growth. Dragon Copilot, deployed in medical settings, now processes 21 million patient interactions each quarter.
More than 80% of Fortune 500 enterprises currently utilize AI agents developed on Microsoft’s platform.
Maia 200 Chip Earns Goldman Recognition
Goldman Sachs analyst Gabriela Borges maintained her Buy rating with a $600 target following Microsoft’s Maia 200 chip reveal.
Prior to this upgrade, Maia’s capabilities fell short of competing processors with insufficient benchmark evidence. Goldman now indicates the chip delivers performance on par with Amazon’s Trainium and Google’s TPU offerings in computational power.
Goldman views this advancement as beneficial for Azure’s artificial intelligence compute profitability over time. Microsoft currently maintains a 69% gross profit margin alongside a 34% return on equity.
The investment firm noted certain constraints — full-scale production metrics remain unavailable, and the software infrastructure supporting Maia requires further development.
Wall Street Consensus
Among 50 analysts tracking MSFT, 41 assign it a Strong Buy rating, four recommend Moderate Buy, and five suggest Hold.
Revenue projections anticipate growth from $281.72 billion in fiscal 2025 to $591 billion by fiscal 2030. Earnings per share estimates range from $13.64 to $31.84 across the same timeframe.
Microsoft unveiled its Maia 200 processor on January 26, 2025, with CEO Satya Nadella highlighting more than 30% enhanced cost efficiency compared to the prior generation.
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