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JPMorgan lifts Microsoft price target on Azure and M365 momentum
The bank raised its target to $625 from $550, citing expectations for faster Azure and M365 Commercial Cloud growth alongside AI infrastructure buildout.
JPMorgan analyst Samik Chatterjee turned bullish on Microsoft after the company’s latest earnings, lifting his price target to $625 from $550. The updated target implies roughly 30% upside from current trading levels, according to the note.
The analyst pointed to what he expects to be an acceleration in growth across Azure and M365 Commercial Cloud, with AI infrastructure buildout described as the key driver for both lines of business. He also argued Microsoft is positioned to monetize its AI infrastructure through M365 cloud products, including Copilot, while benefiting from demand for third-party AI infrastructure from enterprises and AI-focused companies.
The earnings report helped reduce skepticism around the stock, with shares up 25% over the past month, the outlet noted. Microsoft posted $90 billion in fiscal fourth quarter revenue, an 18% year over year increase, while Azure and other cloud services grew 43%.
Microsoft also showed operating leverage, with operating income up 18% to $40.6 billion, alongside significant data center capacity expansion. In addition, CFO Amy Hood paired expense control with $10.2 billion in cash returns to shareholders via dividends and buybacks during the quarter, according to Yahoo Finance.