Overview

• On September 26, Morgan Stanley reiterated Overweight, designated Microsoft its Top Pick, and raised the price target to $625 from $582.
• The firm says Microsoft’s integration of the OpenAI model family has spawned new commercial applications and positions Azure as AI workloads take a larger share of cloud spending.
• In a Morgan Stanley CIO survey, 49% of respondents identified Azure as the likely top IT budget share gainer over the next three years.
• Analysts point to multiple secular growth drivers—generative AI, enterprise migration to public cloud, and cybersecurity revenue exceeding $40 billion—arguing Microsoft offers the clearest positive risk/reward in large‑cap software.
• A separate bullish thesis characterizes Microsoft as building global AI infrastructure, citing more than $56 billion in AI projects, fiscal 2025 CapEx approaching $80 billion, sovereign partnerships with groups like G42 and regions in Saudi Arabia, supercomputing hubs in the U.K., Norway and the U.S., and government adoption such as Copilot in the U.S. House.