Street View: Microsoft's broad-based software boom fuels confidence

Microsoft MSFT.O forecast a record $30 billion in capital spending for Q1FY26, after booming sales in its Azure cloud computing business showcased the growing returns on its massive bets on AI

Shares rise 8.5% to $556.75 premarket; set to soar past $4 trillion in market valuation

'FIRST MOVER ADVANTAGE'

Barclays ("overweight," PT: $625) says "MSFT's unique position with strength in all segments across software (cloud, genAI and apps) seems to be the driving force behind its momentum"

Evercore ISI ("outperform," PT: $545) says "with this level of growth in Azure, while we expect capex growth to normalize a bit, we expect management to continue to lean into capex investments as we remain in the early innings of AI cycle"

Morgan Stanley ("overweight," PT: $582) highlights MSFT's strength broadening across the portfolio
Adds that with key growth trend in software, the core investor question now turns to the durability of that growth

Piper Sandler ("overweight," PT: $650) says there is increased confidence in growth and profit potential for MSFT based on first mover advantage in AI infrastructure