Here are the largest analyst moves focused on artificial intelligence for the week, organized by firm and company. Each note reflects the analysts' view on how AI-related demand and capital spending may influence revenue, margins and investment cycles across cloud, memory and semiconductor equipment markets.
Microsoft - Jefferies: pullback creates opportunity
Jefferies analyst Brent Thill this week argued that the recent decline in Microsoft Corporation (NASDAQ:MSFT) shares presents a compelling buying opportunity. Thill pointed to the company’s robust backlog, expanding AI partnerships and continued cloud momentum as the foundation for a strong multi-year growth profile in large-cap technology.
Thill noted that Microsoft’s stock is down about 18% since the first fiscal quarter (F1Q), despite the company’s disclosure of $250 billion in commitments to OpenAI and $30 billion tied to Anthropic. He emphasized that the company’s current valuation - roughly 23 times calendar 2027 earnings per share - sits below valuations for Amazon and Google even though, in his view, Microsoft offers superior visibility into future revenue streams.
The analyst cited the record contractual commitments tied to OpenAI and Anthropic as a primary justification for stepping in at current price levels. He expects second-quarter remaining performance obligations to reflect what he described as "the largest sequential step-up ever," driven by those agreements and their accompanying revenue recognition mechanics. Thill characterized these arrangements as creating "unprecedented multi-year demand visibility."
Azure continues to be central to the bull case. Thill described Azure demand as supply-constrained rather than demand-constrained, and he highlighted Microsoft’s plan to double its data-center footprint over the next two years. Microsoft has exceeded its Azure revenue guidance for three straight quarters, and Thill said that execution on added capacity alone could generate upside relative to consensus for both the second fiscal quarter and fiscal 2026 Azure estimates.
In addition to capacity expansion, the analyst pointed to accelerating AI monetization through Copilot and other first-party offerings. With Azure representing approximately 30% of total revenue, Thill argued that sustained Azure outperformance could lift the company’s aggregate revenue growth into the high teens. Although he acknowledged ongoing capacity constraints and elevated capital spending levels, Thill concluded that Microsoft is positioned to deliver meaningful upside to both top-line and bottom-line results through fiscal 2026.
Alphabet - Raymond James: AI stack 'shifts to high gear'
Raymond James upgraded Google parent Alphabet (NASDAQ:GOOGL) to Strong Buy, saying the firm believes the company’s AI stack is moving into a higher-velocity phase that should support meaningful upward revisions to medium-term estimates. Analyst Josh Beck said recent bottom-up work on both Search and Google Cloud Platform (GCP) led him to raise revenue forecasts for 2026 and 2027, and that his 2027 revenue projection now sits above broader Street expectations.
Beck argued that Alphabet may be entering a period where an improving AI narrative and related estimate upgrades become a dominant performance driver among mega-cap internet names, rather than a simple mean-reversion trade. In cloud, the analyst modeled GCP revenue growth of 44% in 2026 and 36% in 2027, figures ahead of consensus. He pointed to contributions from infrastructure and platform services, supported by large-scale deployments of TPUs and GPUs and increased adoption of the Gemini API and Vertex AI.
Beck provided a revenue mix projection for GCP by the end of 2027, estimating roughly $25 billion in annualized revenue attributable to TPUs, about $20 billion from GPUs, around $10 billion from Gemini API and roughly $2.5 billion from Vertex AI. Those line items were offered as a way to illustrate the breadth of AI monetization across both custom and general-purpose compute resources and platform services.
For Search, Beck raised his expectations as well, forecasting 13% revenue growth in both 2026 and 2027. He argued that soft spots in core search could be offset by increasing adoption of AI-enhanced features such as AI Overviews, AI Mode and Gemini, which in his view should support stronger cost-per-click trends as query context and conversion metrics improve.
Micron - Stifel: initiates Outperform on memory upturn
Stifel this week initiated coverage of Micron Technology with an Outperform rating. The firm framed the memory market as entering a multi-year upturn, underpinned by structural AI demand dynamics and a persistently tight supply backdrop. Stifel’s thesis is that rising average selling prices and a favorable mix shift toward higher-margin memory products will support margin expansion for Micron.
Stifel emphasized that access to memory has become a critical bottleneck in AI racks and systems, increasing interest in higher-performance, higher-bandwidth memory solutions. The brokerage expects supply to remain constrained into 2027, creating a favorable environment for sustained pricing strength and improved margins. Within that context, Stifel forecasted non-GAAP EPS growth for Micron of more than 275% over the next two years.
High-bandwidth memory (HBM) is central to the firm’s positive outlook. Stifel said HBM has become increasingly important as AI models scale in complexity and require faster access to larger data sets. As next-generation chips integrate more HBM, memory is becoming a larger component of total AI infrastructure spending. As the number-two supplier in the market, Stifel expects Micron’s HBM revenue to rise 164% in fiscal 2026 and a further 40% in fiscal 2027. Stifel also noted that DDR and QLC NAND segments should see tailwinds from AI-related demand.
Stifel also highlighted a set of risks to its thesis, including the potential for Samsung to re-emerge as a more meaningful HBM competitor, heavy capital spending that could tilt value toward equipment suppliers, a possible easing in DRAM supply-demand dynamics, and the risk that chipmakers elect to design their own base logic dies. On valuation, Stifel noted Micron trades at about 9.7 times calendar 2026 earnings, modestly below historical averages, and argued that while the valuation already embeds significant growth expectations, shares can continue to appreciate on the back of a multi-year, AI-driven product cycle characterized by tight supply.
Arm - Mizuho: selloff creates entry point
Mizuho analyst Vijay Rakesh recommended using the recent Arm Holdings selloff to build positions, arguing that the market reaction has been overly negative with respect to handset demand. Arm has declined roughly 30% since November, while the Philadelphia Semiconductor Index has gained about 10% over the same period. Rakesh said the concerns behind Arm’s price action are overdone and that Mizuho would be buyers of Arm on the approximate 30% pullback.
Rakesh pointed out that Arm’s growth drivers extend well beyond smartphones. While royalty revenue is roughly 50% tied to mobile, he noted that Arm’s royalties historically have outgrown handset trends and are expected to register annual growth between 7% and 31% from 2021 through 2027. A structural uplift to royalties is anticipated from the ongoing shift toward Arm’s v9 architecture, which the analyst said carries a two-times average selling price per core compared with v8.
The analyst also highlighted growing interest in custom silicon, suggesting that potential ASIC and CPU ramps in 2027 and 2028 could add more than $1 billion of top-line upside. He cited opportunities related to AI-focused custom chips, including a possible training and inference ASIC connected to OpenAI and SoftBank, and suggested that this project alone could conservatively contribute about $1 billion into calendar 2027-28 estimates.
Beyond mobile, Arm is gaining presence in data centers as hyperscalers increasingly adopt its architectures. Rakesh referenced platforms such as Amazon Web Services’ Graviton, Microsoft’s Cobalt, Meta’s planned CPU and Nvidia’s Grace and Vera as indicators of a growing customer base that could improve Arm’s royalty mix over time. He reiterated an Outperform rating and a $190 price target, describing Arm as well positioned as the broadest global semiconductor platform.
Morgan Stanley - bullish on European semiconductors
Morgan Stanley upgraded the European semiconductor sector to Overweight, saying the space offers a constructive setup for selective stock selection. Strategists at the firm pointed to rising diversification inflows into European equities, an ongoing narrowing of Europe’s valuation discount to the United States, and a favorable role for semiconductor equipment names as beneficiaries of the next phase of AI-related capital spending.
The strategists argued that while European equities already display idiosyncratic behavior, there is scope for increased stock-level dispersion as the cycle progresses. They emphasized that the preferred expression of their view is analyst-led stock selection rather than broad factor exposure, noting that bottom-up fundamentals are beginning to drive top-down performance for semiconductor names.
ASML has been the dominant contributor to Morgan Stanley’s European top picks performance so far this year, according to the bank, accounting for more than half of weighted gains. ASML also represents around 80% of the MSCI Europe Semiconductors and Semicap sector, making it a pivotal name within the group. Looking forward, Morgan Stanley said the primary risk in the AI capex cycle for 2026 is shifting from demand to execution and transition - a dynamic that favors exposure to European semicap firms, particularly those linked to extreme ultraviolet lithography.
The strategists expect order intake in coming quarters to confirm higher foundry and memory capital spending into 2027, alongside better-than-feared demand from China. From a strategy standpoint, Morgan Stanley adjusted its sector model to reflect stronger earnings and broader price-target revision breadth for European semiconductors, while neutralizing factors such as accruals and reducing China exposure. Those changes elevated the sector to second place in the bank’s internal rankings, behind banks.
At the stock level, Morgan Stanley highlighted ASML and ASM International as Top Picks, and it called out BE Semiconductor Industries as an Overweight-rated beneficiary of the same thematic drivers.
Takeaway
The analysts’ notes this week collectively underscore a pattern: sell-side firms are increasingly linking AI-related compute demand and platform monetization to material revenue and margin implications across cloud providers, memory suppliers and equipment makers. While the exact timing and magnitude of those impacts remain subject to execution and supply-side dynamics, the analyst actions illustrate where firms see the most direct exposure to AI-driven capital spending and software monetization.
Across these notes, common threads include the importance of contractual commitments and visibility for cloud providers; the role of memory, especially HBM, as a potential bottleneck and margin lever in AI systems; the growth runway for semiconductor intellectual property and royalties beyond mobile; and a pivot toward equipment and semicap exposure in Europe as the AI capex cycle evolves.
Methodology note
All figures and forecasts cited in this article are taken from the respective analysts' published notes and modeling work. The summaries above seek to capture the principal elements of each firm's positioning without adding external data or new numeric assumptions.