Cantor Fitzgerald has renewed its Overweight recommendation on Microsoft (NASDAQ:MSFT), keeping a $590.00 price target following the company’s most recent financial release. According to InvestingPro data cited by analysts, the market consensus remains strongly positive, with price targets spanning $450 to $730 and the stock trading at $424.51 at the time of that assessment.
Microsoft reported a substantial year-over-year revenue increase of more than $75 billion, bringing total revenue to approximately $350 billion. That growth was supported by notable uptake of Copilot across the company’s platforms and sustained usage gains. In the company’s cloud segment, Azure and Other Cloud Services recorded 38% constant currency growth, slightly above the 37% guidance the company had provided, a performance driven by broad AI-related demand, infrastructure-as-a-service (IaaS) activity and contributions tied to OpenAI.
Over the past twelve months, Microsoft’s revenue expanded by 15.59%, with the company generating $293.81 billion in revenue during that twelve-month period. For the fiscal third quarter of 2026, Microsoft set Azure constant currency growth guidance at 37%-38%, which sits ahead of the Street consensus of 36.4%. Company commentary noted that had Microsoft allocated all GPUs that became available in the prior two quarters exclusively to Azure, the constant currency growth rate would have topped 40%.
InvestingPro data assigns Microsoft an overall financial health score of "GREAT," reflecting a balance sheet and operating profile that analysts believe can sustain ongoing cloud infrastructure investments. On capacity additions, Microsoft added 1GW of compute capacity in fiscal second quarter 2026 compared with 2GW for all of fiscal 2025.
Product-level usage metrics highlighted strong traction for Copilot offerings. Microsoft 365 Copilot daily active users rose tenfold year-over-year in the fiscal second quarter of 2026, and GitHub Copilot Pro Plus subscriptions expanded 77% year-over-year. The company’s stock has delivered a 9.69% price total return over the past year despite recent market volatility.
On profitability, Microsoft reported an operating margin of 47.1%, outpacing Street expectations of 45.6%. The firm’s gross profit margin stood at 68.76%. However, higher-than-expected capital expenditures and the absence of a larger upside surprise in Azure growth were noted by analysts as pressures on the share price in pre-market trading following the results. Microsoft also extended its dividend for the 20th consecutive year, with the current yield at 0.76%.
Market participants have adjusted forecasts and targets in response to the fiscal second-quarter figures. TD Cowen trimmed its price target to $610, pointing to Azure’s 38% constant currency growth versus expectations of 39%. JPMorgan lowered its target to $550 while retaining an Overweight rating and continuing to evaluate Microsoft’s positioning in cloud computing and enterprise software. Deutsche Bank set a new target of $575, characterizing results as solid but below high expectations for Azure. Scotiabank moved its target to $600, similarly noting that results were solid but did not meet second- and third-quarter Azure expectations. Oppenheimer maintained a $630 price target and described Microsoft’s performance as solid despite a deceleration in Azure growth.
These analyst revisions underscore ongoing scrutiny of Microsoft’s cloud growth trajectory even as the company posts strong revenue and user growth metrics across AI-related products and cloud services. For investors and market observers, the mix of robust top-line expansion, high margins and continued capital investment presents both opportunities and points of focus as analysts refine valuation ranges and guidance assumptions.
Summary
Cantor Fitzgerald reiterated an Overweight rating and $590.00 price target on Microsoft after the company reported strong revenue growth and continued Azure momentum. InvestingPro data shows a strong buy consensus with targets between $450 and $730. Microsoft posted more than $75 billion in year-over-year revenue growth to about $350 billion, with Azure up 38% in constant currency and Microsoft 365 Copilot usage surging tenfold year-over-year.
Key points
- Analyst sentiment remains positive - Cantor Fitzgerald reiterated Overweight with a $590.00 target; InvestingPro shows price targets from $450 to $730.
- Cloud and AI products are driving revenue - Azure and Other Cloud Services grew 38% in constant currency; Copilot adoption and OpenAI-related demand contributed materially.
- Profitability and investment - Operating margin was 47.1% and gross margin 68.76%, but increased capital expenditures weighed on near-term market reaction.
Risks and uncertainties
- Azure growth expectations - Several analysts reduced targets citing Azure growth that fell short of some expectations; this affects enterprise software and cloud infrastructure sectors.
- Capital expenditure pressure - Higher-than-expected capex may temper near-term returns despite strong margins, impacting investor sentiment in technology and infrastructure spending.
- Allocation of GPU capacity - Microsoft noted that different GPU allocation scenarios would materially change reported Azure growth, introducing uncertainty around near-term capacity-driven results.