Microsoft (MSFT +2.70%) is scheduled to release its fiscal 2026 fourth-quarter results (ended June 30) on July 29, and I think it could spark a recovery in the company's languishing stock, which is currently down 29% from its record high.
Microsoft has been a casualty of the broader sell-off in the software sector, as investors fear that the growing adoption of artificial intelligence (AI) could render legacy software products obsolete. But the company is proving it can use this revolutionary technology to its advantage, not just in its software business but also in its booming cloud computing segment.
Microsoft stock is heading into July 29 at a very attractive price, so here's why it could be a good long-term buy before the earnings release.
Image source: Getty Images.
All eyes on Copilot adoption Microsoft developed its own AI virtual assistant called Copilot, which it embedded in the Windows operating system, Edge internet browser, and Bing search engine for free. But it's also available as a paid add-on to the 365 productivity suite, helping users rapidly create content in Word, Excel, PowerPoint, Outlook, and more.
Companies around the world pay for more than 400 million 365 licenses for their employees, and all of them are candidates for the Copilot add-on, so this move represents a huge financial opportunity for Microsoft. By the end of the fiscal 2026 third quarter, ended March 31, enterprises had added Copilot to 20 million licenses, up by an eye-popping 250% year over year.
While pure-play AI companies OpenAI and Anthropic have to acquire customers from scratch, Microsoft can sell Copilot and other AI products into its enormous existing customer base. Therefore, while some investors believe legacy enterprise software is in trouble, Microsoft is turning its product portfolio into a huge advantage in the AI race.
Copilot adoption will be closely watched by investors when the company reports its fourth-quarter results on July 29. I think further triple-digit growth could flip the opinion of some of the more bearish investors.
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Azure likely grew at a rapid pace, again Developing AI models from scratch requires substantial computing capacity, which is typically delivered by large data centers equipped with thousands of specialized chips. Most enterprises can't afford to build this infrastructure themselves, so they rent it from cloud computing platforms such as Microsoft Azure.
Microsoft already operates data centers worldwide, but it's working to double its footprint over the next two years to meet demand for computing power from the AI industry. In fact, as of March 31, the company had a staggering $627 billion order backlog from customers who were waiting for more infrastructure to come online, and that figure doubled from the same time last year.
Azure's total revenue increased by 40% year over year during the third quarter, an acceleration from the 39% growth it delivered three months earlier in the second quarter. But considering Microsoft thinks it can convert its entire $627 billion backlog into revenue over the next two and a half years, I think even faster growth could be ahead.
If Microsoft shows even further growth in its order backlog on July 29, that will only increase my conviction that Azure is on track for more blockbuster quarterly revenue results.
Should you buy Microsoft stock before July 29? The 29% decline in Microsoft stock from its record high has pushed its price-to-earnings (P/E) ratio down to just 22.9, making it substantially cheaper than the Nasdaq-100 index, which has a P/E of 34.5. In other words, Microsoft appears to be heavily undervalued compared with a basket of its big-tech peers.
Its stock looks even more attractive when looking ahead. Based on Wall Street's earnings estimate for fiscal 2027 (which started on July 1), its forward P/E is 19.9.
Data by YCharts.
If we assume Wall Street's earnings estimate proves to be accurate, Microsoft stock would have to soar by 73% over the next 12 months just to trade in line with the 34.5 P/E ratio of the Nasdaq-100. That isn't unrealistic considering Microsoft averaged a P/E of 32.7 over the last 10 years.
Simply put, investors are getting a fantastic price for Microsoft heading into its latest quarterly report on July 29. It will probably take a series of positive results over the next year or so to rebuild investors' confidence in its software business, but the rewards might be worth the wait.
Microsoft’s cybersecurity business is developing more artificial intelligence (AI) security products, cutting back on some of its more traditional security products, and consolidating engineering teams, which has led to several hundred layoffs, The Information reported Wednesday (July 15), citing unnamed sources.
The company is making these changes to better respond to customer demand for solutions to the threat of AI-powered hacks, and to capture some of the spending that is going to AI firms Anthropic and OpenAI, according to the report.
Reached by PYMNTS, Microsoft declined to comment on the report.
According to The Information’s report, the overhaul is being led by Hayete Gallot, who took over the security business in February. Gallot is prioritizing AI-powered tools such as Microsoft Security Copilot, products that scan code for vulnerabilities and products that help companies monitor their own AI agents.
“The entire industry is getting reimagined from the ground up,” Gallot wrote in an internal Microsoft memo, per the report. “And it will reward the companies that see the shift early, make the hard choices, and execute with discipline. A few months ago, we made those choices. Now we must execute.”
Microsoft Chairman and CEO Satya Nadella wrote in a Feb. 4 blog post that Gallot rejoined Microsoft as executive vice president, security, and would report to him. Gallot had held senior leadership roles at the company for 15 years before moving to Google, where she served as president, customer experience for Google Cloud.
“She brings an ethos that combines product building with value realization for customers, which is critical right now,” Nadella said in the post. “As we shared during our quarterly earnings last week, we have great momentum in security, including progress with Security Copilot agents, strong Purview adoption, and continued customer growth, and we will build on this.”
It was reported Wednesday that Microsoft is intensifying its competitive strategy against OpenAI and Anthropic by positioning its services as a more secure and cost-effective end-to-end alternative for corporate clients.
The PYMNTS Intelligence report “Where Payments Decisions Happen: How Issuer Data Is Powering the Next Era of Commerce” found that 42% of issuers said AI has helped them save more than $5 million from fraud attempts in recent years.
Microsoft appears to be prepping its sales team to get more competitive with the other major players in the AI industry.
At an internal meeting on Tuesday, the company’s executives outlined a plan for salespeople to negatively compare AI products from companies like OpenAI, Google, and Anthropic to its own, according to a new report from Bloomberg. The meeting, billed as a strategy session for the new fiscal year, reportedly leaned heavily on pitching the efficiency and cost-effectiveness of Microsoft’s in-house models against those of its rivals.
“Everyone else is selling parts — we’re selling the full end-to-end system. That’s the story that we all need to get out there and tell in FY27,” Executive Vice President Jay Parikh reportedly told the room.
Executive Vice President Jacob Andreou reportedly went further, delivering a presentation comparing Copilot directly to Anthropic’s chatbot Claude. According to Bloomberg, Andreou noted that, when it came to performance within Microsoft’s office apps, Anthropic’s model was “slower and less accurate, and lacked the proper security integrations,” Bloomberg writes.
TechCrunch has reached out to Microsoft and Anthropic for comment and will update this story if we hear from either outfit.
A company coaching its sales team on how to trash-talk competitors isn’t particularly surprising. What’s more notable is who Microsoft is now targeting — the same companies it has long depended on for the AI models powering its own products.
It’s just the latest move in that direction. A report earlier this month found that Microsoft has been swapping OpenAI and Anthropic’s models out of flagship apps like Word and Excel in favor of its own — a cost-cutting move, according to that report.
There was a time when Microsoft and OpenAI were attached at the hip. The two companies entered into a very unique agreement years ago that saw Microsoft provide capital and compute to OpenAI while allowing Microsoft to enjoy exclusive access to OpenAI’s API and models. The companies amended the partnership in April, dropping the exclusivity clause and clearing OpenAI to sell to Microsoft’s competitors.
That revised relationship may help explain the sales team’s new pitch. Microsoft has been battling a less-than-optimal stock outlook over the past year, as investors question the company’s massive spending on the buildout of its AI business. Talking up how competitive those products actually are is likely an attempt to calm those waters and build confidence in Microsoft’s long-term AI plan.
When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.
Lucas is a senior writer at TechCrunch, where he covers artificial intelligence, consumer tech, and startups. He previously covered AI and cybersecurity at Gizmodo. You can contact Lucas by emailing [email protected].
Microsoft’s cybersecurity business is developing more artificial intelligence (AI) security products, cutting back on some of its more traditional security products, and consolidating engineering teams, which has led to several hundred layoffs, The Information reported Wednesday (July 15), citing unnamed sources.
The company is making these changes to better respond to customer demand for solutions to the threat of AI-powered hacks, and to capture some of the spending that is going to AI firms Anthropic and OpenAI, according to the report.
Reached by PYMNTS, Microsoft declined to comment on the report.
According to The Information’s report, the overhaul is being led by Hayete Gallot, who took over the security business in February. Gallot is prioritizing AI-powered tools such as Microsoft Security Copilot, products that scan code for vulnerabilities and products that help companies monitor their own AI agents.
“The entire industry is getting reimagined from the ground up,” Gallot wrote in an internal Microsoft memo, per the report. “And it will reward the companies that see the shift early, make the hard choices, and execute with discipline. A few months ago, we made those choices. Now we must execute.”
Microsoft Chairman and CEO Satya Nadella wrote in a Feb. 4 blog post that Gallot rejoined Microsoft as executive vice president, security, and would report to him. Gallot had held senior leadership roles at the company for 15 years before moving to Google, where she served as president, customer experience for Google Cloud.
“She brings an ethos that combines product building with value realization for customers, which is critical right now,” Nadella said in the post. “As we shared during our quarterly earnings last week, we have great momentum in security, including progress with Security Copilot agents, strong Purview adoption, and continued customer growth, and we will build on this.”
It was reported Wednesday that Microsoft is intensifying its competitive strategy against OpenAI and Anthropic by positioning its services as a more secure and cost-effective end-to-end alternative for corporate clients.
The PYMNTS Intelligence report “Where Payments Decisions Happen: How Issuer Data Is Powering the Next Era of Commerce” found that 42% of issuers said AI has helped them save more than $5 million from fraud attempts in recent years.
Microsoft (MSFT +2.70%) has been a terrible stock to own so far in 2026; it's down around 20% so far this year. However, I think things will change after July 29, because that's when Microsoft reports earnings for its fiscal 2026's fourth quarter (ended June 30).
I think the bar for Microsoft to report a solid earnings report is relatively low, and if it can keep the status quo from previous earnings reports, it will be perfectly set up to skyrocket for one main reason.
Image source: Microsoft.
Microsoft's stock is cheap Thanks to the sell-off this year, Microsoft's valuation has plummeted. It now trades for about 20 times forward earnings.
MSFT PE Ratio (Forward) data by YCharts
This is uncharted territory for Microsoft, as it has historically traded for about 30 times forward earnings. Should Microsoft report a fantastic earnings report and the market deems it worthy of returning to its normal valuation range, that represents 50% upside in the stock -- something few big tech companies can say. Furthermore, its current price tag is cheaper than the broader market, as measured by the S&P 500, which trades for 21.7 times forward earnings.
For Q4, Wall Street analysts expect revenue growth of 15%, with earnings per share coming in around $4.24. If Microsoft can exceed those expectations, it may be in a perfect situation to soar after earnings, and it may be set up to do just that because its Q3 results were much better than what's expected in Q4.
Last quarter, its revenue rose at an 18% year-over-year pace, with diluted earnings per share increasing 23% year over year to $4.27. The bar isn't all that high for Microsoft, and if it can clear it by a wide margin, the stock could easily deliver double-digit returns following its earnings announcement on July 29.
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One item investors will also be watching for is its capital expenditure guidance for fiscal 2027. The market isn't giving the AI hyperscalers a ton of leash on unnecessary capital expenditures, and with Microsoft spending hundreds of billions on data centers, it's making a huge investment in the AI realm. But if its cloud computing revenue growth rate continues to accelerate, that will satisfy most investors, as there is a tangible return there because others are paying for its cloud usage, rather than Microsoft using it internally.
Those are some of the key items to watch for, but I'm betting Microsoft will be just fine following earnings, and investors who have held the stock throughout the sell-off will be happier in a few weeks after their earnings announcement is complete.
, /PRNewswire/ -- Rosen Law Firm, a global investor rights law firm, reminds purchasers of common stock of Microsoft Corporation (NASDAQ: MSFT) between May 1, 2025 and January 28, 2026, inclusive (the "Class Period"), of the important August 11, 2026 lead plaintiff deadline.
So What: If you purchased Microsoft common stock during the Class Period you may be entitled to compensation without payment of any out of pocket fees or costs through a contingency fee arrangement.
What to do next: To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action. A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than August 11, 2026. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
Why Rosen Law: We encourage investors to select qualified counsel with a track record of success in leadership roles. Often, firms issuing notices do not have comparable experience, resources, or any meaningful peer recognition. Many of these firms do not actually handle securities class actions, but are merely middlemen that refer clients or partner with law firms that actually litigate the cases. Be wise in selecting counsel. The Rosen Law Firm represents investors throughout the globe, concentrating its practice in securities class actions and shareholder derivative litigation. Rosen Law Firm has achieved the largest ever securities class action settlement against a Chinese Company. Rosen Law Firm was Ranked No. 1 by ISS Securities Class Action Services for number of securities class action settlements in 2017. The firm has been ranked in the top 4 each year since 2013 and has recovered billions of dollars for investors. In 2019 alone the firm secured over $438 million for investors. In 2020, founding partner Laurence Rosen was named by law360 as a Titan of Plaintiffs' Bar. Many of the firm's attorneys have been recognized by Lawdragon and Super Lawyers.
Details of the case: According to the lawsuit, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and (4) as a result, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing. When the true details entered the market, the lawsuit claims that investors suffered damages.
To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor's ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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BENSALEM, Pa., July 15, 2026 (GLOBE NEWSWIRE) -- Law Offices of Howard G. Smith reminds investors that class action lawsuits have been filed on behalf of shareholders of the following publicly-traded companies. Investors have until the deadlines listed below to file a lead plaintiff motion.
Investors suffering losses on their investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in these class actions at (215) 638-4847 or by email to [email protected].
Erasca, Inc. (NASDAQ: ERAS)
Class Period: January 14, 2025 – April 26, 2026
Lead Plaintiff Deadline: August 10, 2026
The complaint alleges that throughout the Class Period the defendants made false and/or misleading statements and/or failed to disclose that: (1) ERAS-0015’s preclinical data was based on improper comparisons to RevMed and placed Erasca at risk of violating patent and trade secret protections; and (2) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Nano-X Imaging Ltd. (NASDAQ: NNOX)
Class Period: March 31, 2025 – April 17, 2026
Lead Plaintiff Deadline: August 11, 2026
The complaint alleges that throughout the Class Period the defendants made false and/or misleading statements and/or failed to disclose that: (1) Defendants overstated purported efficiency gains achieved in Nano-X’s operations, as well as the purported increased demand for its products; (2) in reality, Nano-X’s production and manufacturing operations were poorly aligned with demand for the Company’s products; (3) as a result, Nano-X was experiencing significantly increased operating expenses and cash burn; (4) the foregoing significantly increased the likelihood that Nano-X would be forced to take disruptive remedial measures with respect to its manufacturing operations, entailing significant restructuring and impairment charges; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Microsoft Corporation (NASDAQ: MSFT)
Class Period: May 1, 2025 – January 28, 2026
Lead Plaintiff Deadline: August 11, 2026
The complaint alleges that throughout the Class Period the defendants made false and/or misleading statements and/or failed to disclose: (1) that Microsoft’s Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) that Microsoft’s flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) that Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; (4) that, as a result of the foregoing, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company’s Copilot offerings had lost market share to rival products, a trend that was increasing; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Black Rock Coffee Bar, Inc. (NASDAQ: BRCB)
Class Period: September 12, 2025 – May 12, 2026
Lead Plaintiff Deadline: August 17, 2026
The complaint alleges that throughout the Class Period the defendants made false and/or misleading statements and/or failed to disclose: (1) Black Rock Coffee’s new store openings were leading to a cannibalization of its existing services and revenue; (2) Black Rock Coffee overstated the manner in which its expansion strategy was tailored to avoid “sales transfer”; (3) as a result of “sales transfer,” the Company’s financial results were materially impacted; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
To be a member of these class actions, you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action. If you wish to learn more about these class actions, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847 or by email to [email protected], or visit our website at www.howardsmithlaw.com.
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On Tuesday, Microsoft patched a historic record number of security bugs across its product lines, in large part due to the use of AI to help the company and external researchers to discover bugs.
Among the fixed vulnerabilities there was one for the remastered version of the classic 25-year-old war strategy video game Age of Empires II. The flaw allowed hackers to take over a victim’s computer by sending a custom malicious game invite, according to security researchers.
A video posted on X shows how the flaw could be exploited by hackers.
Here’s the Age of Empires RCE from yesterday’s Patch Tuesday: CVE-2026-50663.
Join an attacker’s lobby, (auto-)accept UCG, and you get remote code execution. pic.twitter.com/QmMkY07C8S
— Rick de Jager (@rdjgr) July 15, 2026 According to cybersecurity firm Rapid7, a successful attack would have allowed hackers to place malicious files on the victim’s computer, opening the door for the hacker to achieve the ability to run malicious code on the victim’s machine.
That means, effectively, that the hacker could have taken over control of the hacked computer.
There is no evidence that this bug was successfully exploited in the wild by hackers. But targeting video gamers can be an effective way to install malware on a high number of victims’ computers and steal their passwords, for example.
Alert: Microsoft's AI Promises Propelled MSFT Above $550 Per Share Before Alleged Copilot Deficiencies Surfaced, Costing Investors Billions in Market Value
, /PRNewswire/ -- Levi & Korsinsky, LLP notifies investors in Microsoft Corporation (NASDAQ: MSFT) that a class action has been filed on behalf of shareholders who purchased securities between May 1, 2025 and January 28, 2026. Find out if you qualify to recover losses. You may also contact Joseph E. Levi, Esq. at [email protected] or (212) 363-7500.
During the Class Period, MSFT shares traded at all-time highs above $550 per share as management touted "best-in-class" AI capabilities and record Microsoft 365 Copilot adoption across 90% of the Fortune 500. The lead plaintiff deadline is August 11, 2026.
How Alleged Misrepresentations Inflated MSFT's Market Price
The securities action asserts that Microsoft's stock price was artificially inflated by a sustained campaign of optimistic statements about the Company's AI products and cloud infrastructure. Throughout the Class Period, executives claimed Copilot was the fastest-growing product in Microsoft 365 history, that usage intensity was doubling quarter over quarter, and that Azure AI services were driving 16 points of cloud revenue growth. These statements allegedly fueled investor demand that pushed MSFT to record valuations.
The complaint contends that behind these public proclamations, the Copilot family of products suffered from significant brand positioning failures, data siloing limitations, computational capacity constraints, and interoperability problems that defendants knew about or recklessly disregarded. When the market began processing the gap between the Company's representations and the actual state of its AI offerings, billions in shareholder value evaporated.
The Azure-OpenAI Revenue Loop and Market Perception
Investors bid MSFT shares higher in part because of management's emphasis on massive AI-related contracts. The lawsuit chronicles how executives highlighted OpenAI's $250 billion Azure services commitment and Anthropic's $30 billion compute capacity agreement as proof of surging demand. The action claims these figures obscured the circular nature of the arrangements: Microsoft invested billions in these same LLM providers, who then committed to spending those dollars back on Microsoft's Azure platform. The filing states this dynamic created an appearance of organic demand growth that the market relied upon when pricing MSFT shares.
Market Repricing After Concealed Problems Emerged
The complaint details how the market ultimately reassessed MSFT's valuation as investors learned that:
Copilot's "record" adoption figures masked deep user experience and interoperability failures that limited real-world productivity gains The Company's AI infrastructure buildout, including plans to double its data center footprint, carried concentration and return-on-investment risks that were downplayed to investors Seat growth was concentrated in lower-ARPU segments like small businesses and frontline workers, undermining the revenue acceleration narrative The multibillion-dollar LLM provider partnerships created circular revenue dependencies rather than the independent demand growth executives described See if you can recover losses from your MSFT investment or call (212) 363-7500.
"When companies fail to disclose material information, shareholders may suffer significant losses. The magnitude of MSFT's market capitalization swing following these revelations underscores how heavily investors relied on management's AI growth narrative," stated Joseph E. Levi, Esq.
Join the Microsoft securities recovery action now or contact Joseph E. Levi, Esq. at (212) 363-7500.
ABOUT LEVI & KORSINSKY, LLP -- Over the past 20 years, Levi & Korsinsky has secured hundreds of millions of dollars for aggrieved shareholders. The firm has extensive expertise in complex securities litigation and a team of over 70 employees. For seven consecutive years, Levi & Korsinsky has ranked in ISS Securities Class Action Services' Top 50 Report. The last day to move for lead plaintiff is August 11, 2026.
Frequently Asked Questions About the MSFT Lawsuit
Q: How much did MSFT stock drop? A: Shares traded at all-time highs above $550 per share during the Class Period before declining significantly after the market began processing that Microsoft's AI product claims were allegedly misleading. Investors who purchased shares at artificially inflated prices may be entitled to compensation.
Q: What specific misstatements does the MSFT lawsuit allege? A: The complaint alleges Microsoft made materially false or misleading statements regarding the success, adoption, and performance of its Copilot AI products and the return on investment for its multibillion-dollar AI capital expenditures, while concealing significant technical and organizational problems.
Q: What do MSFT investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at [email protected] or (212) 363-7500. No immediate action is required to remain eligible as a class member.
Q: What if I already sold my MSFT shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the Class Period and sold at a loss may still participate.
Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.
Q: How long will the lawsuit take to resolve? A: Securities class actions typically take two to four years from initial filing to resolution.
Q: Can I join a different law firm's lawsuit instead? A: Multiple firms often file competing complaints. The court consolidates and appoints a single lead counsel. Contacting Levi & Korsinsky before August 11, 2026 ensures your losses are considered.
CONTACT:\
Levi & Korsinsky, LLP\
Joseph E. Levi, Esq.\
Ed Korsinsky, Esq.\
33 Whitehall Street, 27th Floor\
New York, NY 10004\
[email protected]\
Tel: (212) 363-7500\
Fax: (212) 363-7171
As Microsoft Corp. (NASDAQ: MSFT) stock attempted a market reversal from its 12-month correction, the company has received its first Sell rating in the past 3 months.
On July 15, Tyler Radke, an analyst at Citigroup Inc. (NYSE: C), assigned a ‘Sell’ rating for MSFT stock. Radke further lowered the firm’s 12-month price target for Microsoft stock to $570 from $620, thus signaling a potential 48.08% upside.
Earlier on Wednesday, Greg Moskowitz, an analyst at Mizuho Securities, reiterated a Buy rating for MSFT shares. Moskowitz, however, lowered the firm’s 12-month price target for MSFT stock to $490 from $515, thus signaling a possible 27.3% upside.
Michael Turrin, an analyst at Wells Fargo & Co. (NYSE: WFC), assigned a Buy rating for MSFT shares. Additionally, Turrin lowered the bank’s 12-month target to $625 from $625.
Citi’s Radke argued that the bullish outlook is based on the company’s repositioning to align with the AI boom. Furthermore, the bank anticipates Microsoft to report strong fourth-quarter results.
Meanwhile, Wells Fargo’s Turrin signaled improving Azure growth, operating expense discipline, and the AI boom as key drivers to propel MSFT stock higher over the next 12 months.
MSFT stock price forecast and performance As more Wall Street analysts assigned a bullish outlook for Microsoft over the next 12 months, the average price target increased. As of press time, 36 analysts surveyed by TipRanks have an average price target of $559.14, representing a 44.67% upside.
MSFT stock price forecast. Source: TipRanks As a core AI stock, Microsoft stock could rally over the coming months to retest its all-time high (ATH), which is in line with analysts’ expectations. At press time, MSFT shares traded at about $388.91 after recently rebounding from a crucial multi-year support level.
Microsoft shares chart. Source: Finbold However, if the company’s stock drops below its established support level around $358, the analysts’ 12-month prediction could be invalidated.
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Key Takeaways CoreWeave may offer greater AI upside, while Microsoft provides a more diversified growth profile.CRWV is expanding AI infrastructure, with backlog nearing $100 billion and revenue targets rising.Microsoft is growing AI across Azure, Copilot and cloud, but faces higher AI infrastructure spending risks. AI is increasingly gaining traction in the technology sector, creating enormous opportunities for companies that build the infrastructure powering next-generation AI models. While technology giants like Microsoft Corporation (MSFT - Free Report) have emerged as leaders in AI through strategic investments and ecosystem expansion, newer players, such as CoreWeave, Inc. (CRWV - Free Report) , are rapidly gaining attention by providing specialized cloud infrastructure purpose-built for AI workloads.
Per a report from Fortune Business Insights, the global cloud AI market size is anticipated to go from $133.4 billion in 2026 to $780.6 billion by 2034 at a CAGR of 23.8%. For investors, the question is becoming increasingly relevant: Should you invest in the AI giant with diversified earnings or the pure-play AI infrastructure company with explosive growth potential?
Here's a closer look at how CoreWeave and Microsoft compare.
The Case for MSFT StockMicrosoft benefits from a diversified revenue stream across cloud computing, productivity software, enterprise services, gaming and other areas. Its leadership in Azure and extensive AI ecosystem position the company to take advantage of the growing adoption of enterprise AI. Additionally, Microsoft's high recurring software revenue, supported by subscription-based products, generates strong free cash flow and offers a stable foundation for long-term growth.
Microsoft continues to show strong financial results, with revenue and operating income growing at double-digit rates and operating margins reaching 46%. Cloud and AI remain the main growth drivers, with cloud revenue up 29% and AI’s annual recurring revenue more than doubling, backed by strong enterprise demand. The company is investing heavily in AI infrastructure, expanding global data center capacity, launching Maia AI accelerators and Cobalt CPUs, and enhancing deployment efficiency to meet increasing demand. Microsoft also strengthens its AI platform through Azure AI Foundry, first-party AI models and a unified data layer across Fabric, Foundry and Microsoft 365.
Customer adoption continues to grow rapidly, with Microsoft 365 Copilot exceeding 20 million paid seats. GitHub Copilot and Security Copilot are gaining momentum, and enterprise use of AI agents and real-time data is increasing. Management anticipates that AI will support sustained double-digit revenue and operating income growth, driven by a shift to a hybrid subscription and usage-based pricing model. To capitalize on this opportunity, Microsoft plans substantial investments in AI infrastructure, while using hardware innovation and operational efficiencies to sustain healthy long-term margins.
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However, Microsoft's Azure faces intense competition from rivals with significant resources and innovation. Rising capital spending raises worries about returns and financial stability, with CapEx hitting $31.9 billion in the third quarter and expected to be over $40 billion in the fourth quarter. The combination of high capital needs, lease obligations and large AI infrastructure costs suggests Microsoft has sacrificed some financial flexibility to fund growth and shareholder payouts. This financial vulnerability provides little room to handle economic or competitive challenges, increasing risks for shareholders.
The Case for CRWV StockCoreWeave has consistently reported triple-digit revenue growth as enterprise AI adoption accelerates. Demand for NVIDIA (NVDA - Free Report) GPUs continues to exceed supply, allowing specialized providers like CoreWeave to maintain exceptionally high utilization rates. Long-term contracts with leading AI companies also provide significant revenue visibility. It became the first AI cloud provider to complete system-level validation of NVDA Vera Rubin NVL72, reaffirming its leadership in next-generation AI infrastructure. In January, NVIDIA increased its investment in CoreWeave to $2 billion.
CoreWeave continues to benefit from strong AI infrastructure demand, with its backlog nearing $100 billion, active power exceeding 1 GW and more than 3.5 GW under contract. AI workloads are mainly shifting toward inference, driving customer diversification across top AI labs, hyperscalers and enterprises, while more than 10 customers have committed over $1 billion each. The company is quickly expanding its infrastructure and platform capabilities through new data centers, self-built sites, enhanced cloud services and cross-cloud solutions.
Its partnership with NVIDIA has been strengthened through software validation, while diversified suppliers and secured component procurement support future capacity growth. CoreWeave has also bolstered its financial position by raising significant debt and equity capital, reducing its cost of debt and reaffirming its revenue outlook. Management expects revenue to surpass $18 billion in 2026 and $30 billion in 2027, driven by strong demand, growing AI inference workloads and a long-term goal of more than 8 gigawatts of active power by 2030.
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Nonetheless, CoreWeave faces several risks, including its heavy reliance on continued AI infrastructure spending and substantial capital expenditure requirements to support rapid expansion. The company also has significant customer concentration, making it dependent on a relatively small number of large clients. In addition, CRWV’s stock is likely to remain highly volatile given its high-growth profile; while intensifying competition from hyperscalers and other cloud providers could pressure its growth and margins over time.
CRWV & MSFT’s Share PerformanceYear to date, CRWV has surged 11.7% while MSFT is down 20.4%.
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Valuation ConsiderationsCoreWeave commands a premium valuation because investors expect years of extraordinary expansion. Microsoft trades at a premium relative to the broader market but remains supported by durable earnings, robust cash flow and a diversified business model.
In terms of Price/Book, CRWV shares are trading at 7.52X, marginally above MSFT’s 6.9X.
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How Do Zacks Estimates Compare for CRWV & MSFT?The Zacks Consensus Estimate for CoreWeave’s earnings for 2026 has been trimmed down 0.6% over the past 60 days.
Image Source: Zacks Investment Research
For MSFT, there has been zero revision.
Image Source: Zacks Investment Research
CRWV or MSFT: Which Stock Offers More Upside?Both companies are well-positioned to benefit from the AI boom, but they target different types of investors.
If AI infrastructure demand continues to grow at today's rate, CoreWeave has significantly more room for expansion than Microsoft. The company operates with a much smaller revenue base, meaning each new customer and data center can boost growth. Microsoft offers a more balanced investment profile. Its AI initiatives are strengthening almost every existing business, while Azure continues to capture enterprise cloud demand. Even if AI spending slows down, Microsoft's software, cloud, productivity and security businesses provide steady earnings growth. For investors looking for maximum exposure to AI infrastructure growth, CoreWeave might offer greater upside potential over the next few years.
CRWV at present carries a Zacks Rank #2 (Buy) while MSFT has a Zacks Rank #3 (Hold). Consequently, in terms of Zacks Rank, CRWV seems to be a better pick at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Microsoft MSFT stock rose about 3% on Wednesday as Wall Street analysts reaffirmed their bullish outlook on the software giant despite trimming some price targets ahead of the company's fiscal fourth-quarter earnings report later this month.
Shares gained after Evercore ISI raised its price target on Microsoft to $525 from $510 while maintaining an Outperform rating.
The brokerage expects Microsoft to deliver double-digit revenue and operating income growth in fiscal 2027, supported by continued investment in artificial intelligence and improving momentum across its cloud business.
The firm said Microsoft shares have remained range-bound as investors wait for greater clarity on Azure cloud revenue acceleration and the monetization of Microsoft Copilot.
Evercore ISI expects Azure growth to strengthen in the second half of the year while Copilot adoption continues to improve.
The brokerage also forecasts fiscal 2027 cash capital expenditures of about $210 billion, above the Street estimate of roughly $180 billion.
According to Evercore ISI, capital expenditure growth could begin to normalize in 2027 after the current investment cycle while providing a catalyst for improving investor sentiment.
Analysts remain optimistic despite price target cutsWhile Evercore ISI became more optimistic, several other brokerages reduced their price targets ahead of Microsoft's earnings release without changing their positive recommendations.
Citi Research lowered its target price to $570 from $620 but maintained a Buy rating.
The revised target still represents substantial upside from Microsoft's recent trading levels.
"We remain positive on MSFT," Citi analyst Tyler Radke wrote Wednesday, adding that the company is "increasingly strategically positioned in an era of optimizing token spend and AI efficiency."
The brokerage expects Microsoft to report a strong fiscal fourth quarter but said investors should prepare for higher artificial intelligence spending in fiscal 2027.
"We think MSFT will be able to demonstrate stronger returns with accelerating growth rates in flagship franchises (Azure + M365 CoPilot) as we move into FY27, which would ultimately drive accelerating overall revenue/EPS growth through FY30," Radke wrote.
Wells Fargo also maintained a constructive stance despite highlighting mixed expectations for the fourth quarter.
The firm pointed to concerns surrounding Microsoft's cloud market share and capital spending but said stronger Azure growth, AI adoption and operating expense discipline could support a stronger fiscal 2027 outlook.
Mizuho also lowered its price target, cutting it to $490 from $550 as part of a broader revision across software stocks.
However, the brokerage said its channel checks remained positive overall, with public cloud demand staying strong and AI adoption remaining robust.
AI investment and earnings remain key focusMicrosoft's continued investment in artificial intelligence remains a central theme for investors ahead of earnings.
Evercore ISI said Azure acceleration, Copilot momentum and moderating capital expenditure growth could help improve sentiment during the second half of calendar 2026.
The company is scheduled to report fiscal fourth-quarter earnings on July 29.
Consensus estimates compiled by Fiscal AI project earnings of $4.24 per share on revenue of $86.66 billion.
Analyst sentiment remains overwhelmingly positive ahead of the results.
According to Koyfin data, 53 of the 56 analysts covering Microsoft rate the stock as a Buy or stronger recommendation, while the remaining analysts maintain Hold ratings.
New York, New York--(Newsfile Corp. - July 15, 2026) - Bronstein, Gewirtz & Grossman, LLC, a nationally recognized investor-rights law firm, announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ: MSFT) and certain of its officers.
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Microsoft securities between May 1, 2025 and January 28, 2026, both dates inclusive (the "Class Period"). Such investors are encouraged to join this case by visiting the firm's site: bgandg.com/MSFT.
Microsoft Case Details
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements because they failed to disclose that:
Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and as a result of the above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing.What's Next for Microsoft Investors?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm's site: bgandg.com/MSFT, or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 917-590-0911. If you suffered a loss in Microsoft you have until August 11, 2026, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
No Cost to Microsoft Investors
We, Bronstein, Gewirtz & Grossman LLC, represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys' fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman, LLC for Microsoft Securities Class Action?
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide. More at www.bgandg.com
"Our practice centers on restoring investor capital and ensuring corporate accountability, which serves to uphold the essential integrity of the marketplace," said Peretz Bronstein, Founding Partner of Bronstein, Gewirtz & Grossman, LLC.
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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/301530
Source: Bronstein, Gewirtz & Grossman, LLC
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Key Takeaways MSFT moved several Premium event features into Teams Enterprise and introduced new event licensing options.MSFT reported 17% Productivity and Business Processes revenue growth, led by Microsoft 365 Commercial.Microsoft's Teams pricing differs from Zoom and Salesforce by expanding base-tier features over paid tiers. Microsoft (MSFT - Free Report) is reshaping how it charges for Teams, and the shift carries real implications for the stock. Effective April 1, 2026, the company moved a broad set of previously Premium-only features, including town hall and webinar tools, streaming chat, real-time event insights and immersive 3D events, into the base Teams Enterprise license, while narrowing Teams Premium to a smaller set of security, branding and AI-driven capabilities still priced at $10 per user per month. To offset lost Premium revenues from smaller events, Microsoft introduced Attendee Capacity Pack licenses, letting organizations scale events up to 100,000 participants without full per-seat licensing, alongside a new Teams Shared Space license tied to physical desks rather than users. Teams Live Events will be fully retired by June 30, 2026, pushing remaining customers toward the new unified events framework.
These product changes sit against a backdrop of solid underlying performance. In the third quarter of fiscal 2026, ended March 31, Microsoft's Productivity and Business Processes segment, which houses Teams and Microsoft 365 Commercial, grew revenues by $5.1 billion, or 17%, with Microsoft 365 Commercial cloud revenues up 19% on higher revenue per user driven by E5 and Copilot adoption. Total company revenues reached $82.9 billion, up 18%. For the fourth quarter, Microsoft guided to Commercial cloud growth of 15% to 16% in constant currency on an adjusted basis, with sequential increases in net paid seat adds expected to lift ARPU further.
The bet is that broader feature access drives seat expansion and stickiness even as some Premium seats get trimmed at renewal, a trade-off management has not fully quantified. The coming renewal cycles, combined with reported net paid seat adds and ARPU trends in subsequent quarters, will offer the clearest read on how the restructured Teams pricing model is translating into actual monetization for Microsoft's Productivity and Business Processes segment.
How Zoom and Salesforce Approach Collaboration MonetizationMicrosoft's Teams repackaging invites comparison with how Zoom Communications (ZM - Free Report) and Salesforce (CRM - Free Report) monetize collaboration tools. Zoom continues to lean on tiered per-seat plans alongside add-ons like Zoom Phone and AI Companion, rather than folding premium features into lower tiers the way Microsoft has done with Teams Enterprise. Salesforce, through Slack, similarly maintains distinct paid tiers rather than broadly redistributing premium capabilities. Compared with Zoom and Salesforce, Microsoft's move to widen base-tier access while narrowing Premium reflects a different monetization philosophy, one that Zoom and Salesforce have so far not mirrored in their own collaboration product lines.
MSFT’s Share Price Performance, Valuation & EstimatesMSFT shares have lost 15.3% in the past six-month period compared with the Zacks Computer – Software industry’s decline of 19.8%. The Zacks Computer and Technology sector has appreciated 14.1% in the same time frame.
MSFT’s 6-Month Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, MSFT stock appears overvalued, trading at a forward 12-month price/earnings ratio of 19.82X, higher than the industry’s 18.95X. MSFT has a Value Score of C.
MSFT’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MSFT’s fiscal 2026 earnings is pegged at $17.33 per share. The estimate indicates 27.05% year-over-year growth.
Microsoft currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Two Wall Street firms trimmed their price targets on Microsoft (NASDAQ:MSFT | MSFT Price Prediction) ahead of the software giant’s fiscal Q4 report, but neither pulled its bullish rating. Citi lowered its target to $570 from $620 while keeping a Buy rating, and Mizuho analyst Gregg Moskowitz cut his target to $490 from $515 while maintaining an Outperform rating. The message to long-term investors: Wall Street is getting more cautious on price and capex digestion without losing conviction on the underlying business.
Ticker Company Firm Action Old Rating New Rating Old Target New Target MSFT Microsoft Citi Price target cut Buy Buy $620 $570 MSFT Microsoft Mizuho Price target cut Outperform Outperform $515 $490 The Analyst’s Case Citi stays positive after constructive channel checks on Copilot and views Microsoft as increasingly well positioned for optimizing token spend and AI efficiency. The firm expects strong Q4 results but flags that investors will need to digest higher capex spending in Q1.
Mizuho’s cut came as part of a broader large-cap software Q4 earnings preview. Moskowitz described channel checks as good, public cloud data points as strong, and AI adoption as robust. He noted that SaaS remains resilient, but multiples are pressured by investor concerns about AI-led disruption. The common thread is capex intensity, the same concern that has weighed on the Microsoft stock story for months.
Company Snapshot Microsoft’s most recent quarter reinforced the bull case. Revenue reached $82.89 billion, up 18.3% year over year, with EPS of $4.27 beating the consensus of $4.09. Azure and other cloud services grew 40%, and CEO Satya Nadella noted the AI business surpassed an annual revenue run rate of $37 billion, up 123% year-over-year. Commercial remaining performance obligations sit at $627 billion, up 99%.
The catch is spending. Capital expenditures hit $30.88 billion in Q3, an 84.4% year-over-year increase, with Forbes estimating roughly $190 billion in capex for 2026.
Why the Move Matters Now Microsoft shares last traded at $397.05, with the Microsoft stock down 20.05% year to date and 22.86% over the past year. Microsoft reports fiscal Q4 2026 results on July 29, after market close. With both firms flagging capex digestion as the near-term overhang, guidance commentary matters as much as the headline numbers. Analyst consensus still points to 54 Buy ratings, 3 Hold, and 0 Sell (a report like 7 Stocks Powering the AI Boom puts this AI infrastructure debate in wider context).
What It Means for Your Portfolio The analyst price target cuts are a recalibration, not a rejection. Both firms concede that Copilot uptake, Azure momentum, and enterprise AI adoption are tracking well. Their caution centers on when the return on $30.88 billion quarterly capex shows up in reported earnings. For retirement-focused investors, that translates to a familiar tradeoff: durable franchise, sizable long-term option value in AI, and a stock that may trade choppily until capex intensity peaks. The July 29 fiscal Q4 report is the next stress test for the thesis.
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Image Credits:Microsoft / PhotoMosh (edited) Microsoft released a record number of security patches for Windows, Office, and other tech product lines this week, citing the use of AI to aid the discovery of code vulnerabilities.
The technology and cloud giant issued patches for 570 security flaws on Tuesday as part of its monthly scheduled release of fixes, which security researchers have long dubbed “Patch Tuesday.”
At least two of the vulnerabilities are classified as zero-days, meaning that they were exploited before Microsoft was made aware of them. One bug affecting Windows Server allows hackers to escalate their privileges from a limited user to a system administrator. Another bug affects the SharePoint file sharing server — the U.S. government’s cybersecurity agency CISA has warned hackers were actively exploiting the bug to compromise organizations.
Krebs on Security first reported the news.
The huge patch update comes a week after Microsoft said in a blog post that it expected its usual batch of monthly security patches to be far higher in number than before. The company cited its use of AI to help its employees uncover previously undiscovered security bugs in its software.
“As AI helps defenders discover more issues, customers will see a higher volume of security updates included in each security release,” said Windows boss Pavan Davuluri.
As AI models become more advanced and focused on cybersecurity issues, security researchers are using them to uncover vulnerabilities that may have been dormant in software code for years, if not longer. Parts of Microsoft’s Windows code dates back decades.
Microsoft’s total emissions increased 25% in 2025, according to its latest sustainability report, adding to the trend of tech companies polluting more heavily as they ramp up AI data centers.
And the company’s emissions are set to keep surging, outside analysts say, as it relies on fossil fuels to power that infrastructure.
Microsoft says the increase last year was “driven primarily” by the growth of its AI data centers and its decision to pause its use of certain renewable energy certificates.
The tech giant reiterated that it still aims to be carbon negative by 2030, per the sustainability report, meaning that it needs to remove more carbon emissions than it emits.
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But Microsoft’s emissions are likely to keep increasing. Its report did not mention three upcoming gas power plant projects that will more than double its emissions, according to an analysis commissioned by Stand.earth, a nonpartisan, nonprofit environmental advocacy organization.
The three projects will total 4.75 gigawatts of capacity, and are expected to emit more than 15 million metric tons of carbon dioxide every year.
Of course, those emissions wouldn’t be counted in a report looking at 2025, but by not mentioning these planned projects, Microsoft’s sustainability report is “brushing the truth under the rug,” Rachel Kitchin, senior corporate climate campaigner at Stand.earth, says in a statement.
Microsoft becomes first announced hyperscale cloud provider to deploy 3M Expanded Beam Optical (EBO) technology
3M to use Microsoft AI and digital capabilities to advance enterprise transformation across key functions
, /PRNewswire/ -- 3M (NYSE: MMM) and Microsoft (NASDAQ: MSFT) today announced a strategic partnership focused on AI data center infrastructure and enterprise transformation. Microsoft's Azure Cloud and AI Infrastructure will become the first announced hyperscale cloud provider to deploy 3M's Expanded Beam Optical (EBO) technology. 3M will also use Microsoft's AI and digital platforms as part of its enterprise transformation across key business functions.
3M and Microsoft announce a strategic partnership to advance AI data center infrastructure and enterprise transformation. Together, the companies will combine Microsoft's digital and hyperscale infrastructure with 3M's materials science and precision manufacturing to accelerate AI adoption and strengthen the physical networks required for the growth of cloud and AI workloads.
Innovating datacenter infrastructure for the AI era
As Microsoft continues to advance high-performance, efficient and sustainable infrastructure for enterprise and generative AI workloads, it will deploy 3M's proprietary EBO technology in Azure data centers.
By using an expanded beam optical interface instead of the direct contact required in traditional connectors, EBO technology is designed to make fiber connections faster to install, more tolerant of contamination and easier to maintain. The technology will help Microsoft reduce the need for frequent cleaning and inspection while supporting reliable optical performance in dense, high-volume deployment environments.
Microsoft's early use of EBO technology has shown the potential to reduce network deployment timelines in certain environments. The technology has also demonstrated strong signal performance in live data center conditions, where dust exposure and routine handling are inherent to installation and maintenance.
3M is scaling production of its EBO technology to meet accelerating demand from hyperscalers and data center operators building the infrastructure required for AI. Building on decades of materials science and precision-manufacturing expertise, 3M has advanced single-mode expanded beam optical technology for high-volume data center applications, supporting disciplined commercialization and broader adoption across the data center ecosystem. 3M helped establish the EBO Multi-Source Agreement (MSA) to support standardization and broader industry adoption of EBO technology.
"At Microsoft, we're redefining the foundation of cloud and AI infrastructure — combining our own innovations with advances from partners like 3M to build datacenters that are faster to deploy, more resilient and ready for the scale of AI," said Cliff Henson, corporate vice president, Cloud Supply Chain, Microsoft. "3M's EBO solution will help unlock new levels of performance, reliability and efficiency to ensure customers can run their cloud and AI workloads on a trusted, sustainable and advanced environment."
Enterprise AI transformation
3M will deploy Microsoft's AI and digital capabilities in key areas of its enterprise transformation roadmap, including customer service, finance, sales and marketing. These efforts will help simplify processes, improve decision-making, strengthen customer experiences and enable greater employee productivity.
A specific example involves the newly launched Microsoft Frontier Company deploying engineers to help 3M's Global Business Services team automate the way it manages customer orders. Both companies are collaborating on an AI agent-driven workflow to assist with credit checks, delinquency assessments and system updates, with human-in-the-loop controls and a custom monitoring dashboard for real-time visibility and approvals. This solution is expected to significantly reduce manual effort, improve process speed and consistency, and accelerate cash flow, freeing 3M staff for higher-value work and enabling scalable, auditable operation.
"At 3M, we view AI as a powerful tool that can accelerate growth, improve customer experiences and help our teams work more effectively," said Jon Van Wyck, executive vice president and chief strategy officer, 3M. "Our collaboration with Microsoft supports that vision through targeted optimization opportunities for our enterprise while advancing the infrastructure needed to power the future of AI. We are excited to deepen our partnership and develop practical solutions that can create mutual value."
Building the future through science and technology
Microsoft and 3M intend to build on this partnership through continued technical collaboration, bench-to-bench engagement between engineering and commercial teams, and joint innovation opportunities across Microsoft's data center and device ecosystem, with a focus on areas where 3M's materials science, optical connectivity and manufacturing capabilities can help address evolving requirements for reliability, deployment speed, density and long-term scalability.
About 3M
3M (NYSE: MMM) is focused on transforming industries around the world by applying science and creating innovative, customer-focused solutions. Our multi-disciplinary team is working to solve tough customer problems by leveraging diverse technology platforms, differentiated capabilities, global footprint, and operational excellence. Discover how 3M is shaping the future at 3M.com/news.
About Microsoft
Microsoft (Nasdaq "MSFT" @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.
NEW YORK, July 15, 2026 (GLOBE NEWSWIRE) -- Leading securities law firm Bleichmar Fonti & Auld LLP announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ:MSFT) and certain of the Company’s senior executives for securities fraud after its significant stock drop resulting from potential violations of the federal securities laws.
If you invested in Microsoft, you are encouraged to obtain additional information by visiting: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
Key Details of the Microsoft ($MSFT) Class Action:
Lead Plaintiff Deadline: August 11, 2026Alleged Misconduct: Securities fraud alleging that Microsoft misled investors regarding its Azure cloud computing platform and AI chatbot CopilotStock Drop: January 28, 2026 – 10% Stock DropCourt: U.S. District Court for the Western District of WashingtonAction: Contact BFA Law to discuss your rights
Investors have until August 11, 2026 to ask the Court to be appointed to lead the case. The complaint asserts securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Microsoft common stock. The class action is pending in the U.S. District Court for the Western District of Washington. It is captioned City of St. Clair Shores Police and Fire Retirement System, et al., No. 26-cv-02071.
Why is Microsoft Being Sued for Securities Fraud?
Microsoft is a multinational technology company that develops software, cloud services, and devices. In recent years, Microsoft’s cloud computing platform named Azure has been Microsoft’s main growth driver. A key reason for Azure’s recent growth is Microsoft’s multi-billion-dollar investment into AI, including the development of its own generative AI chatbot named Copilot.
According to the complaint, during the relevant period, Microsoft consistently touted Copilot’s best-in-class capabilities, which purportedly drove widespread and growing user adoption. Copilot’s apparent success allowed Microsoft to report surging Azure-related revenue.
As alleged, in truth, Copilot suffered from severe functionality issues that caused user adoption to decline and put Microsoft’s Azure revenue at risk.
Why did Microsoft’s Stock Drop?
On January 28, 2026, Microsoft announced disappointing 2Q 2026 financial results and that Azure growth had slowed suddenly. Microsoft also allegedly revealed for the first time that the number of Microsoft 365 Copilot premium customers totaled only 15 million, materially below analyst estimates.
This news caused the price of Microsoft common stock to decline $48.13 per share, or 10%, from $481.63 per share on January 28, 2026, to $433.50 per share on January 29, 2026.
Additionally, on February 3, 2026, The Wall Street Journal reported in an article titled “Microsoft’s Pivotal AI Product Is Running Into Big Problems” that severe challenges and functionality issues had plagued Copilot, causing the application to lose market share. Specifically, The Wall Street Journal reported that “[c]onfusing brand positioning and interoperability problems have frustrated users.”
Click here for more information: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
What Can You Do?
If you invested in Microsoft, you may have legal options and are encouraged to submit your information to the firm.
All representation is on a contingency fee basis; there is no cost to you. Shareholders are not responsible for any court costs or expenses of litigation. The firm will seek court approval for any potential fees and expenses.
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It has been named a top plaintiff law firm by Chambers USA, The Legal 500, and ISS SCAS, and its attorneys have been named “Elite Trial Lawyers” by the National Law Journal, “Litigation Stars” by Benchmark Litigation, among the top “500 Leading Plaintiff Financial Lawyers” by Lawdragon, “Titans of the Plaintiffs’ Bar” by Law360 and “SuperLawyers” by Thomson Reuters.
Most recently, The Legal 500 awarded BFA the most client satisfaction accolades of any plaintiff’s securities litigation law firm, with clients noting: “[t]here is no better service provider in the practice area,” “[t]he interest of the client is always front and center,” and “[t]here isn’t a better firm in this space.” One testimonial described the firm as “nimble and entrepreneurial,” with a “relentless focus on adding value for clients.”
Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.’s Board of Directors, as well as $420 million from Teva Pharmaceutical Ind. Ltd.
For more information about BFA and its attorneys, please visit https://www.bfalaw.com.
NEW YORK, July 14, 2026 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Microsoft Corporation (“Microsoft” or the “Company”) (NASDAQ: MSFT). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
The class action concerns whether Microsoft and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
You have until August 11, 2026, to ask the Court to appoint you as Lead Plaintiff for the class if you purchased or otherwise acquired Microsoft securities during the Class Period. A copy of the Complaint can be obtained at www.pomerantzlaw.com.
[Click here for information about joining the class action]
On January 28, 2026, Microsoft announced disappointing results for its fiscal second quarter ended December 31, 2025. First, during the quarter Microsoft’s Azure growth had slowed suddenly and fallen below analyst expectations. During the related earnings call, CFO Amy E. Hood revealed that the slower Azure growth was primarily due to computational capacity constraints, as Microsoft had diverted CPU and GPU capacity to Copilot applications and AI-related R&D. Second, Microsoft revealed that its capital expenditures had increased to $37.5 billion during the quarter, causing Microsoft’s capital expenditures for the first six months of its fiscal 2026 to increase to $72.4 billion compared to $88.2 billion for all of Microsoft’s fiscal 2025. Third, Microsoft revealed, for the first time, that the number of paid Microsoft 365 Copilot seats totaled only 15 million to date, materially below analyst estimates and a fraction of the more than 450 million commercial Microsoft 365 users.
On this news, the price of Microsoft stock fell nearly 10%.
Then, on February 3, 2026, The Wall Street Journal revealed, in an article titled “Microsoft’s Pivotal AI Product Is Running Into Big Problems,” that severe challenges and functionality issues had plagued Microsoft’s Copilot offerings, leading to Copilot losing market share during the Class Period to competing products such as Google’s Gemini. The price of Microsoft stock continued to fall in the days after Microsoft’s second quarter 2026 earnings announcement as the market continued to digest the adverse news and sources such as The Wall Street Journal revealed new adverse information.
Thereafter, on March 17, 2026, The Wall Street Journal revealed in an article titled “Microsoft Seeks More Coherence in AI Efforts With Copilot Reorganization” that Microsoft was reorganizing its Copilot product teams to unify commercial and consumer versions partly in response to the challenges revealed by The Wall Street Journal’s prior reporting on Copilot’s problem-plagued development and disappointing customer adoption.
On this news, the price of Microsoft stock continued to fall.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
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Microsoft Corporation remains a Strong Buy despite recent stock declines and market concerns over CapEx and business uncertainties. MSFT's forward P/E for 2027 is 20x, well below its 5-year average of 30x, offering a significant margin of safety even without a re-rating. Key risks include potential enterprise software verticalization, the XBOX division reset, and ongoing high CapEx for AI infrastructure, but fundamentals remain robust.
In the latest trading session, Microsoft (MSFT - Free Report) closed at $384.93, marking a -1.55% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 0.38% for the day. Meanwhile, the Dow experienced a rise of 0.02%, and the technology-dominated Nasdaq saw an increase of 0.9%.
The stock of software maker has fallen by 2.19% in the past month, lagging the Computer and Technology sector's loss of 1.5% and the S&P 500's gain of 1.27%.
Analysts and investors alike will be keeping a close eye on the performance of Microsoft in its upcoming earnings disclosure. The company's earnings report is set to go public on July 29, 2026. The company is expected to report EPS of $4.21, up 15.34% from the prior-year quarter. Alongside, our most recent consensus estimate is anticipating revenue of $87.44 billion, indicating a 14.39% upward movement from the same quarter last year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $17.33 per share and a revenue of $329.26 billion, signifying shifts of +27.05% and +16.87%, respectively, from the last year.
Investors might also notice recent changes to analyst estimates for Microsoft. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.02% higher. Microsoft presently features a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Microsoft has a Forward P/E ratio of 20.27 right now. This denotes a premium relative to the industry average Forward P/E of 16.31.
It is also worth noting that MSFT currently has a PEG ratio of 1.19. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Computer - Software industry held an average PEG ratio of 1.24.
The Computer - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 103, positioning it in the top 42% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
Shareholders of Microsoft (MSFT 1.46%) have had a year of poor performance. The stock last set an all-time high in July 2025, although it nearly set a new one last October. Now, it's down around 30% from those highs, and the market appears to have little faith in the stock.
In fact, it has become so cheap that it's valued at less than the S&P 500. Is that a fair price tag? I don't think so. In fact, I think now is the perfect time to get in on Microsoft because it rarely falls to these valuation levels.
Image source: Getty Images.
A screaming deal right now How cheap is Microsoft stock? I think the best valuation metric is its forward earnings, because the company is growing at an above-average pace. Plus, it has some one-time effects (like gains on investments) influencing its trailing-12-month total. From this metric, it's valued at less than 20 times forward earnings.
MSFT PE Ratio (Forward) data by YCharts; PE = price to earnings.
That's also way cheaper than at any point during the last three years. Currently, the S&P 500 trades for about 21.7 times forward earnings, so this discount is sizable for a big tech company.
The vast majority of Microsoft's big tech peers (like Alphabet, Amazon, and Apple) trade at multiples in the mid to high 20s, with Apple all the way at 36 times forward earnings. So Microsoft appears undervalued, but is there a good reason for that?
After looking at its latest quarterly results, I would say no. During its last quarter, the company's artificial intelligence (AI) revenue rose 123% year over year to a $37 billion annual run rate. Its cloud computing division, which is getting a lot of attention for its AI computing resources, grew 40%.
Overall, revenue rose 18%, with earnings per share up 23%. Those results are indicative of a company that deserves to trade in the same range as its peers, and I won't be surprised if it returns to those levels following its next earnings announcement.
Today's Change
(
-1.46
%) $
-5.71
Current Price
$
385.28
Management reports earnings on July 29, and as long as it keeps the status quo, I think it will be enough to turn around the stock due to such low expectations priced in. Microsoft is a top buy now if you're looking for a cheaply valued big tech stock.
Keithen Drury has positions in Alphabet, Amazon, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, and Microsoft. The Motley Fool has a disclosure policy.
New York, New York--(Newsfile Corp. - July 14, 2026) - WHY: Rosen Law Firm, a global investor rights law firm, reminds purchasers of common stock of Microsoft Corporation (NASDAQ: MSFT) between May 1, 2025 and January 28, 2026, inclusive (the "Class Period"), of the important August 11, 2026 lead plaintiff deadline.
SO WHAT: If you purchased Microsoft common stock during the Class Period you may be entitled to compensation without payment of any out of pocket fees or costs through a contingency fee arrangement.
WHAT TO DO NEXT: To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action. A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than August 11, 2026. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
WHY ROSEN LAW: We encourage investors to select qualified counsel with a track record of success in leadership roles. Often, firms issuing notices do not have comparable experience, resources, or any meaningful peer recognition. Many of these firms do not actually handle securities class actions, but are merely middlemen that refer clients or partner with law firms that actually litigate the cases. Be wise in selecting counsel. The Rosen Law Firm represents investors throughout the globe, concentrating its practice in securities class actions and shareholder derivative litigation. Rosen Law Firm has achieved the largest ever securities class action settlement against a Chinese Company. Rosen Law Firm was Ranked No. 1 by ISS Securities Class Action Services for number of securities class action settlements in 2017. The firm has been ranked in the top 4 each year since 2013 and has recovered billions of dollars for investors. In 2019 alone the firm secured over $438 million for investors. In 2020, founding partner Laurence Rosen was named by law360 as a Titan of Plaintiffs' Bar. Many of the firm's attorneys have been recognized by Lawdragon and Super Lawyers.
DETAILS OF THE CASE: According to the lawsuit, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and (4) as a result, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing. When the true details entered the market, the lawsuit claims that investors suffered damages.
To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor's ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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Microsoft (NASDAQ:MSFT | MSFT Price Prediction) is running one of the fastest scaling AI businesses in corporate history, yet the stock is acting like the story just broke. Satya Nadella told investors “Our AI business surpassed $37 billion ARR, up 123%” and Microsoft Cloud delivered $54 billion in revenue, up 29% year over year.
Meanwhile, shares are down 20.02% year to date and trade at $392.17. Can this stock reach $650 by 2027? The math works if a few things line up.
Why Microsoft Shares Are Stuck Despite Record AI Growth The disconnect is real. Fundamentals are accelerating, but the stock has been ugly. MSFT is off 1.38% over the past week, 3.09% over the past month, and 22.59% over the past year.
Capital expenditures ballooned to $30.88 billion last quarter, an 84.39% year-over-year jump, and management guided to roughly $190 billion in capital expenditures for calendar year 2026. Free cash flow compressed to $15.8 billion.
With a beta of 1.13, MSFT amplifies broader tech drawdowns. Investors are punishing the AI capex race even as gross margins remain healthy. The OpenAI partnership restructuring gives the market an excuse to sit on the sidelines.
Wall Street Sees 43% Upside. Our Model Sees 27%. Who Is Right? Consensus target sits at $559.86, with 13 Strong Buys, 41 Buys, and just 3 Holds. Zero sells. Our model: base case of $497.55, implying 26.87% upside, bull case of $600.44, bear case of $442.57, all at 90% confidence. The Street is likely closer to right.
Bullish analyst sentiment stands at 95%, and earnings growth runs at 23.4% year over year. Our model dampens targets 50% for mega-caps, but a company compounding AI revenue at triple digits may prove this discipline too cautious.
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The Path to $650 Per Share Reaching $650 from today’s price of $392.17 requires a gain of 65.7%. With forward EPS of $18.89, a price of $650 implies a forward P/E of 34x. Our base case of $497.55 already implies 24x, meaning the bold target requires roughly 10x additional multiple expansion. That is a stretch, but not impossible for a company where commercial remaining performance obligations reached $627 billion, nearly doubling year over year.
Nadella emphasized that “We are at the beginning of one of the most consequential platform shifts that will change the entire tech stack as agents proliferate”, and Microsoft added 20 million Microsoft 365 Copilot paid seats with seat additions up 250% year over year. The primary risk is that AI capex compresses margins faster than revenue can absorb.
Where Microsoft Trades Today vs Its Earnings Power At $392.17 against forward EPS of $18.89, MSFT trades at roughly 21x forward earnings. For a business growing revenue 18.3% year over year with operating margins of 46%, that is not expensive.
Shares sit near their 52-week low of $349.20, well below the high of $551.05. Long term, MSFT has returned 718.59% over the past decade. The current multiple looks like a reset, not a topping pattern.
Can Microsoft Really Hit $650? My Verdict Reaching $650 by 2027 requires a 65.7% gain.
Three things need to go right: Azure needs to sustain the 39% to 40% growth guided into Q4, Copilot needs to convert seat momentum into durable per-user economics, and margins need to stabilize as capex peaks. What derails it: a step-down in enterprise AI budgets or a demand cliff at Azure. We’ve outlined the blueprint for how Microsoft could reach $650 in 2027.
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Microsoft (MSFT - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this software maker have returned -2.2%, compared to the Zacks S&P 500 composite's +1.3% change. During this period, the Zacks Computer - Software industry, which Microsoft falls in, has lost 3.5%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Microsoft is expected to post earnings of $4.21 per share, indicating a change of +15.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.2% over the last 30 days.
The consensus earnings estimate of $17.33 for the current fiscal year indicates a year-over-year change of +27.1%. This estimate has remained unchanged over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $19.29 indicates a change of +11.3% from what Microsoft is expected to report a year ago. Over the past month, the estimate has remained unchanged.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Microsoft.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of Microsoft, the consensus sales estimate of $87.44 billion for the current quarter points to a year-over-year change of +14.4%. The $329.26 billion and $381.62 billion estimates for the current and next fiscal years indicate changes of +16.9% and +15.9%, respectively.
Last Reported Results and Surprise HistoryMicrosoft reported revenues of $82.89 billion in the last reported quarter, representing a year-over-year change of +18.3%. EPS of $4.27 for the same period compares with $3.46 a year ago.
Compared to the Zacks Consensus Estimate of $81.4 billion, the reported revenues represent a surprise of +1.83%. The EPS surprise was +4.91%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Microsoft is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Microsoft. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
, /PRNewswire/ -- The Gross Law Firm issues the following notice to shareholders of Microsoft Corporation (NASDAQ: MSFT).
Shareholders who purchased shares of MSFT during the class period listed are encouraged to contact the firm regarding possible lead plaintiff appointment. Appointment as lead plaintiff is not required to partake in any recovery.
ALLEGATIONS: The complaint alleges that during the class period, Defendants issued materially false and/or misleading statements and/or failed to disclose that: (a) Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (b) Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (c) Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; and (d) as a result of (a)-(c) above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company's Copilot offerings had lost market share to rival products, a trend that was increasing.
DEADLINE: August 11, 2026 Shareholders should not delay in registering for this class action. Register your information here: https://securitiesclasslaw.com/securities/microsoft-corporation-loss-submission-form/?id=193590&from=4
NEXT STEPS FOR SHAREHOLDERS: Once you register as a shareholder who purchased shares of MSFT during the timeframe listed above, you will be enrolled in a portfolio monitoring software to provide you with status updates throughout the lifecycle of the case. The deadline to seek to be a lead plaintiff is August 11, 2026. There is no cost or obligation to you to participate in this case.
WHY GROSS LAW FIRM? The Gross Law Firm is a nationally recognized class action law firm, and our mission is to protect the rights of all investors who have suffered as a result of deceit, fraud, and illegal business practices. The Gross Law Firm is committed to ensuring that companies adhere to responsible business practices and engage in good corporate citizenship. The firm seeks recovery on behalf of investors who incurred losses when false and/or misleading statements or the omission of material information by a company lead to artificial inflation of the company's stock. Attorney advertising. Prior results do not guarantee similar outcomes.
CONTACT:
The Gross Law Firm
15 West 38th Street, 12th floor
New York, NY, 10018
Email: [email protected]
Phone: (646) 453-8903
SummaryMicrosoft (MSFT) remains highly attractive on a risk-reward basis despite recent S&P 500 underperformance. MSFT trades at 20x earnings, a 20% discount to the sector median, yet offers superior growth and premium margins. I see no structural concerns and maintain a Strong Buy rating for MSFT at current levels. MSFT's brand strength and competitive moat further justify a valuation premium over peers. Vertigo3d/E+ via Getty Images
Honestly, Microsoft (MSFT) at the moment remains one of the most interesting names in terms of risk to reward ratio in my opinion. Clearly, my bullish thesis hasn't played out the way I thought it would
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of MSFT, NVDA, AMZN, AAPL, META either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
Zacks Premium also includes the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.94% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Microsoft (MSFT - Free Report) Microsoft Corporation is one of the largest broad-based technology providers in the world. The company dominates the PC software market with more than 73% of the market share for desktop operating systems.
MSFT is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Additionally, the company could be a top pick for growth investors. MSFT has a Growth Style Score of B, forecasting year-over-year earnings growth of 27.1% for the current fiscal year.
One analyst revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.00 to $17.33 per share. MSFT boasts an average earnings surprise of +8.4%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, MSFT should be on investors' short list.
Key Takeaways Alphabet, Microsoft, Amazon and Ciena are positioned to benefit from expanding cloud and AI demand.Google Cloud, Azure and AWS are scaling infrastructure, services and AI capabilities worldwide.Ciena's WaveLogic and Blue Planet tools support bandwidth growth, automation and AI-driven networks. An updated edition of the May 21, 2026, article.
Cloud computing has emerged as one of the most “hot and happening” long-term growth drivers in the technology industry, enabling businesses to operate more efficiently, innovate faster and strengthen their competitive position. Its growing adoption across industries has been fueled by key advantages such as greater flexibility, scalability, accessibility and cost efficiency. Powered by virtualization technology, cloud computing has accelerated digital transformation by allowing organizations to access, manage and store data over the Internet without depending on physical servers or complex on-premises IT infrastructure.
By enabling multiple users to share computing resources through web browsers or dedicated applications connected to cloud-based platforms, it optimizes resource utilization and improves operational efficiency. Additionally, cloud computing has made seamless omnichannel customer engagement more accessible while significantly reducing infrastructure and operating costs.
Cloud computing is an attractive theme for investors seeking exposure to blue-chip tech firms. This has made cloud computing firms, such as Alphabet Inc. (GOOGL - Free Report) , Microsoft Corporation (MSFT - Free Report) , Amazon.com, Inc. (AMZN - Free Report) and Ciena Corporation (CIEN - Free Report) , indispensable to any investment portfolio. But before delving into these prized possessions, let us examine a little more why organizations are increasingly adopting cloud computing.
Based on a pay-per-use pricing model, enterprises only pay for the computing resources they use. This has helped business enterprises reduce operating costs for maintaining on-site data centers and deploying IT experts to manage the infrastructure, making it a highly cost-effective solution. With easy access to a plethora of innovative technologies, cloud computing increases productivity with greater agility and flexibility, and improves scalability with higher economies of scale. Moreover, cloud computing services are delivered over a highly secure network with low latency for applications and data backup facilities for improved reliability.
Cloud computing services fall into four broad categories – infrastructure as a service (IaaS), platform as a service (PaaS) and serverless and software as a service (SaaS) – each offering different levels of control, flexibility and management options to business enterprises. Cloud computing, which relies heavily on virtualization and automation technologies, provides the requisite infrastructure for AI (artificial intelligence) and machine learning (ML) workloads. It delivers powerful computing abilities to process and analyze data, creating an ideal platform for Big Data management.
Per Grand View Research, the global cloud computing market size is expected to swell to $3,349.6 billion by 2033 from $943.7 billion in 2025 at a CAGR of 16% with a variety of capabilities across multiple industries. These include diverse use cases such as improved patient monitoring and outcomes in healthcare, personalized financial management and predictive spending, immersive learning in education, superior inventory management in retail and predictive maintenance and better supply chain management in the manufacturing sector.
If you intend to capitalize on this buzzing trend, our Cloud Computing Thematic Investing Screen could make it easy to identify high-potential stocks in this domain at any given time, just like the four mentioned above. By leveraging advanced tools, our thematic screens identify companies shaping the future, making it easier to benefit from emerging trends.
Ready to uncover more transformative thematic investment ideas? Explore 36 cutting-edge investment themes with Zacks Thematic Investing Screens and discover your next big opportunity.
Key Cloud Computing Stocks to Bet OnAlphabet has been growing rapidly in the booming cloud-computing market. Over the last few years, the company has evolved from primarily being a search engine provider to a leading provider of cloud computing technology. Google Cloud is one of the key catalysts behind the company’s growth, driven by its strengthening cloud service offerings.
The solid adoption of the Google Cloud Platform and Google Workspace and continued investments in infrastructure, security, data management, analytics and AI have helped Google to expand its cloud footprint worldwide. The increasing number of cloud regions and availability zones globally has been a hallmark of Google Cloud. Currently, Google Cloud has 43 cloud regions, 130 availability zones and more than 200 network edge locations across more than 200 countries. Google Cloud is considered the third-largest cloud player among numerous cloud providers worldwide.
Google Cloud is benefiting from Alphabet’s years of investments in AI infrastructure, custom silicon and enterprise software that are beginning to translate into substantial financial returns. Alphabet’s growing GenAI capabilities and significant investments in cloud computing are potential catalysts for the future amid stiff competition in the cloud space and increasing regulatory headwinds. It has a VGM Score of B. Alphabet sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Microsoft is one of the most prominent public cloud providers that delivers a wide variety of IaaS and PaaS solutions at scale. Microsoft Azure, its cloud computing platform, allows users to build, run and scale applications in the cloud. It offers a variety of services, including storage, networking, analytics and AI.
Microsoft has doubled down on the cloud computing opportunity. Azure’s increased availability in more than 60 announced regions globally has strengthened Microsoft's competitive position in the cloud computing market. Operating through a vast network of global data centers that ensure high availability and reliability for applications, Azure offers seamless access to all the services included in the portal once customers subscribe to it. Subscribers can use these services to create cloud-based resources, such as virtual machines (VMs) and databases, which can then be assembled into running environments used to host workloads and store data.
As Microsoft continues to push the boundaries of networking technology, it aims to create innovative, resilient and secure solutions that enable businesses to leverage AI and the cloud to their fullest potential. This Zacks Rank #3 (Hold) company is investing heavily in AI-powered cloud services, integrating Azure OpenAI Service, Copilot and ML into various cloud solutions, making AI a central feature of Azure to empower organizations to manage their applications with greater confidence and efficiency. It has a VGM Score of B.
Amazon enjoys a leading position in the cloud computing market, particularly in the IaaS space, thanks to Amazon Web Services (“AWS”), which is one of its high-margin-generating businesses. The expanding customer base of AWS, driven by its strengthening cloud offerings, will continue to aid Amazon's dominance in the global cloud space.
AWS is the world’s most comprehensive and broadly adopted on-demand cloud computing platform, offering more than 200 fully featured services from data centers globally. Millions of customers, including the fastest-growing startups, largest enterprises and leading government agencies, are using AWS to lower costs, become more agile and innovate faster. It reportedly offers the widest variety of databases that are purpose-built for different types of applications to enable subscribers to choose the right tool for the job.
Amazon aims to extend AWS’ AI and ML capabilities to facilitate improved decision-making. This Zacks Rank #2 (Buy) company intends to expand its global infrastructure for faster and more reliable service with low latency and maximum availability. From cloud-native applications and AI-driven solutions to edge computing and sustainability initiatives, AWS is likely to push the limits in the realm of cloud computing technology.
Ciena has emerged as a key beneficiary of the cloud computing boom. The company’s advanced optical networking and automation solutions are witnessing strong demand as hyperscalers and telecom operators continue expanding data center infrastructure to support AI workloads and rising global data traffic. Higher demand for bandwidth and adoption of cloud architectures for generative AI applications and AI model training remain key growth drivers, as the company expects its profitability to improve on a balanced mix of new and existing customers.
Ciena is well-positioned to capitalize on the secular growth trend through its industry-leading coherent optical technology portfolio, particularly its WaveLogic platform. The company’s latest WaveLogic 6 Extreme solution supports transmission speeds of up to 1.6 terabits per second per wavelength, enabling cloud providers to scale network capacity efficiently while lowering power consumption and operating costs by maximizing existing fiber infrastructure without the need for extensive new fiber deployment.
Ciena’s portfolio, including WaveLogic, RLS, Navigator and Interconnect Solutions, remains a recognized industry standard. The company is also strengthening its position through software-driven networking solutions. Its Blue Planet automation platform helps operators simplify network management through AI-driven orchestration, analytics and automation capabilities. This Zacks Rank #1 company’s technological leadership, expanding hyperscaler relationships and growing software capabilities position it favorably within the rapidly evolving AI infrastructure ecosystem.
, /PRNewswire/ -- The Law Offices of Howard G. Smith announces that investors with substantial losses have opportunity to lead the securities fraud class action lawsuit against Microsoft Corporation ("Microsoft" or the "Company") (NASDAQ:MSFT).
IF YOU ARE AN INVESTOR WHO SUFFERED A LOSS IN MICROSOFT CORPORATION (MSFT), CONTACT THE LAW OFFICES OF HOWARD G. SMITH BEFORE AUGUST 11, 2026 (LEAD PLAINTIFF DEADLINE) TO PARTICIPATE IN THE ONGOING SECURITIES FRAUD LAWSUIT.
Contact the Law Offices of Howard G. Smith to discuss your legal rights by email at [email protected], by telephone at (215) 638-4847 or visit our website at www.howardsmithlaw.com.
What Is The Lawsuit About?
The complaint filed alleges that, between May 1, 2025 and January 28, 2026, Defendants failed to disclose to investors: (1) that Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) that Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) that Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; (4) that, as a result of the foregoing, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company's Copilot offerings had lost market share to rival products, a trend that was increasing; and (5) as a result, Defendants' positive statements about the Company's business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Contact Us To Participate or Learn More:
If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to the pending class action lawsuit, please contact:
Howard G. Smith, Esq.,
Law Offices of Howard G. Smith,
3070 Bristol Pike, Suite 112,
Bensalem, Pennsylvania 19020,
Call us at: (215) 638-4847
Email us at: [email protected],
Visit our website at: www.howardsmithlaw.com.
To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
Contact Us:
Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
[email protected]
www.howardsmithlaw.com
Microsoft shares are retreating from recent levels. Why is MSFT stock falling? The LayoffsReplacing OpenAI With Its Own ModelsAnalyst Consensus & Recent ActionsThe stock carries a Buy rating with an average price target of $552.96. Recent analyst moves include:
Argus Research: Buy (Lowers Target to $510.00) (July 10) BMO Capital: Outperform (Raises Target to $515.00) (July 7) Wolfe Research: Outperform (Lowers Target to $525.00) (July 6) Looking Ahead to EarningsMicrosoft is expected to report fourth-quarter earnings on July 29. Analysts estimate earnings per share of 4.23, along with revenue of $87.61 billion.
Microsoft Shares Edge LowerMSFT Price Action: At the time of publication, Microsoft shares are trading 3.07% lower at $379.00, according to data from Benzinga Pro.
Image via Shutterstock
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Market News and Data brought to you by Benzinga APIs
NEW YORK, July 14, 2026 (GLOBE NEWSWIRE) -- SueWallSt notifies investors in Microsoft Corporation (NASDAQ: MSFT) that a class action lawsuit has been filed on behalf of shareholders who purchased securities between May 1, 2025 and January 28, 2026. Find out if you may qualify to recover losses. You may also contact Joseph E. Levi, Esq. at [email protected] or (888) SueWallSt.
Microsoft shares traded above $550 during the Class Period as the Company touted "best-in-class" AI capabilities and record Copilot adoption. The lead plaintiff deadline is August 11, 2026.
The Alleged AI Product Deception
The artificial intelligence sector has attracted hundreds of billions in enterprise spending, and Microsoft positioned itself at the center of that wave. Throughout the Class Period, the Company claimed its Copilot family of products enjoyed surging adoption, with management representing that 90% of the Fortune 500 used Microsoft 365 Copilot and that paid commercial seats grew 7% year-over-year to over $430 million. The lawsuit contends these statements concealed a far different reality.
How Copilot's Alleged Deficiencies Affected Investor Confidence
According to the complaint, Microsoft's Copilot products suffered from significant brand positioning failures, user experience shortcomings, data siloing constraints, computational capacity bottlenecks, organizational dysfunction, and interoperability problems. The action further alleges that:
Copilot's brand was fragmented through numerous launch versions across various consumer and enterprise applications with inconsistent features and unclear differentiationData siloing prevented Copilot from delivering the "Work IQ" contextual intelligence that management claimed set the product apart from competitorsComputational capacity constraints limited the product's ability to perform complex agentic workflows that executives publicly promotedOrganizational problems hampered coordination between teams responsible for different Copilot iterationsInteroperability failures undermined claims that Copilot seamlessly integrated across Outlook, Word, Excel, PowerPoint, and TeamsThe "freemium" to paid seat conversion pipeline was allegedly far weaker than management's representations suggested The Circular Investment Risk Allegedly Hidden from Shareholders
The lawsuit also contends that Microsoft downplayed the circularity embedded in its multibillion-dollar AI partnerships. The Company invested over $13 billion in OpenAI and committed up to $5 billion in Anthropic, while those same partners contracted to purchase billions in Azure services. This arrangement allegedly created concentration risk that management minimized even as it drove reported Azure revenue growth figures that the market relied upon.
"This case presents important questions about AI product disclosure obligations in the enterprise technology sector. When a company represents that its flagship AI offering is 'best-in-class' and enjoying record adoption, investors are entitled to know about material technical and organizational problems undermining those claims." -- Joseph E. Levi, Esq.
Submit your information here or contact Joseph E. Levi, Esq. at (888) SueWallSt.
WHY SUEWALLST: SueWallSt is powered by Levi & Korsinsky LLP. Levi & Korsinsky LLP has established itself as a nationally-recognized securities litigation firm that has secured hundreds of millions of dollars for aggrieved shareholders and built a track record of winning high-stakes cases. The firm has extensive expertise representing investors in complex securities litigation and a team of over 70 employees to serve our clients. For seven years in a row, Levi & Korsinsky has ranked in ISS Securities Class Action Services' Top 50 Report as one of the top securities litigation firms in the United States.
Frequently Asked Questions About the MSFT Lawsuit
Q: What is the MSFT class action lawsuit about? A: A securities class action has been filed against Microsoft Corporation (NASDAQ: MSFT) alleging materially false and misleading statements about the Company's AI initiatives, Copilot products, and Azure cloud platform between May 1, 2025 and January 28, 2026. The complaint alleges Microsoft concealed significant technical and organizational problems while touting record AI adoption.
Q: Who is eligible to join the MSFT investor lawsuit? A: Investors who purchased MSFT stock or securities between May 1, 2025 and January 28, 2026 and suffered financial losses may be eligible. Eligibility is based on purchase date and documented losses, not on whether you still hold the shares.
Q: What do MSFT investors need to do right now? A: Investors may gather brokerage records showing purchase dates, share quantities, and prices paid. Contact SueWallSt, a brand of Levi & Korsinsky LLP, for a no-cost, no-obligation case evaluation at [email protected] or (212) 363-7500. No immediate action is required to remain eligible as an absent class member.
Q: What if I already sold my MSFT shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the class period and sold at a loss may still participate.
Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.
Q: What specific misstatements does the MSFT lawsuit allege? A: The complaint alleges Microsoft made materially false or misleading statements regarding Copilot's adoption rates, technical capabilities, competitive positioning, and the return on investment for AI-related capital expenditures, while concealing brand positioning failures, data siloing, and computational capacity problems.
Q: How long will the lawsuit take to resolve? A: Securities class actions typically take two to four years from initial filing to resolution.
CONTACT:
Levi & Korsinsky, LLP
Joseph E. Levi, Esq.
33 Whitehall Street, 27th Floor
New York, NY 10004 [email protected]
Tel: (888) SueWallSt
Fax: (212) 363-7171
Attorney Advertising. Prior results do not guarantee similar outcomes.
A securities fraud class action lawsuit has been filed on behalf of Microsoft investors after its stock plummeted 10% because Microsoft allegedly misled investors regarding its AI chatbot Copilot and cloud computing platform Azure.
, /PRNewswire/ -- Leading securities law firm Bleichmar Fonti & Auld LLP announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ:MSFT) and certain of the Company's senior executives for securities fraud after its significant stock drop resulting from potential violations of the federal securities laws.
If you invested in Microsoft, you are encouraged to obtain additional information by visiting: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
Key Details of the Microsoft ($MSFT) Class Action:
Lead Plaintiff Deadline: August 11, 2026 Alleged Misconduct: Securities fraud alleging that Microsoft misled investors regarding its Azure cloud computing platform and AI chatbot Copilot Stock Drop: January 28, 2026 – 10% Stock Drop Court: U.S. District Court for the Western District of Washington Action: Contact BFA Law to discuss your rights Investors have until August 11, 2026 to ask the Court to be appointed to lead the case. The complaint asserts securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Microsoft common stock. The class action is pending in the U.S. District Court for the Western District of Washington. It is captioned City of St. Clair Shores Police and Fire Retirement System, et al., No. 26-cv-02071.
Why is Microsoft Being Sued for Securities Fraud?
Microsoft is a multinational technology company that develops software, cloud services, and devices. In recent years, Microsoft's cloud computing platform named Azure has been Microsoft's main growth driver. A key reason for Azure's recent growth is Microsoft's multi-billion-dollar investment into AI, including the development of its own generative AI chatbot named Copilot.
According to the complaint, during the relevant period, Microsoft consistently touted Copilot's best-in-class capabilities, which purportedly drove widespread and growing user adoption. Copilot's apparent success allowed Microsoft to report surging Azure-related revenue.
As alleged, in truth, Copilot suffered from severe functionality issues that caused user adoption to decline and put Microsoft's Azure revenue at risk.
Why did Microsoft's Stock Drop?
On January 28, 2026, Microsoft announced disappointing 2Q 2026 financial results and that Azure growth had slowed suddenly. Microsoft also allegedly revealed for the first time that the number of Microsoft 365 Copilot premium customers totaled only 15 million, materially below analyst estimates.
This news caused the price of Microsoft common stock to decline $48.13 per share, or 10%, from $481.63 per share on January 28, 2026, to $433.50 per share on January 29, 2026.
Additionally, on February 3, 2026, The Wall Street Journal reported in an article titled "Microsoft's Pivotal AI Product Is Running Into Big Problems" that severe challenges and functionality issues had plagued Copilot, causing the application to lose market share. Specifically, The Wall Street Journal reported that "[c]onfusing brand positioning and interoperability problems have frustrated users."
Click here for more information: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
What Can You Do?
If you invested in Microsoft, you may have legal options and are encouraged to submit your information to the firm.
All representation is on a contingency fee basis; there is no cost to you. Shareholders are not responsible for any court costs or expenses of litigation. The firm will seek court approval for any potential fees and expenses.
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It has been named a top plaintiff law firm by Chambers USA, The Legal 500, and ISS SCAS, and its attorneys have been named "Elite Trial Lawyers" by the National Law Journal, "Litigation Stars" by Benchmark Litigation, among the top "500 Leading Plaintiff Financial Lawyers" by Lawdragon, "Titans of the Plaintiffs' Bar" by Law360 and "SuperLawyers" by Thomson Reuters.
Most recently, The Legal 500 awarded BFA the most client satisfaction accolades of any plaintiff's securities litigation law firm, with clients noting: "[t]here is no better service provider in the practice area," "[t]he interest of the client is always front and center," and "[t]here isn't a better firm in this space." One testimonial described the firm as "nimble and entrepreneurial," with a "relentless focus on adding value for clients."
Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.'s Board of Directors, as well as $420 million from Teva Pharmaceutical Ind. Ltd.
For more information about BFA and its attorneys, please visit https://www.bfalaw.com.
On July 29, Microsoft (MSFT +1.68%) reports its fiscal fourth quarter earnings, and that should be a date to circle on your investment calendar.
It could be the date that Microsoft begins its run after struggling for most of 2026. Unlike most of the other "Magnificent Seven" stocks, which have recovered from sell-offs earlier in the year, Microsoft stock has been stuck in reverse, down 20% year to date.
But here's why Microsoft stock is poised to break out after July 29.
Image source: Getty Images.
AI spending paying off One of the major concerns about Microsoft among investors is its perceived overspending on artificial intelligence (AI). In April, the tech giant upped its capital expenditure forecast to $190 billion for fiscal 2026, which is 61% more than the previous year.
The stock tanked in Microsoft's fiscal third quarter ended March 31 amid concerns about its exclusive partnership with OpenAI and reports of its unprofitability. It didn't help that Microsoft's Azure revenue growth dipped slightly.
But there are strong signs that the investments in AI infrastructure are starting to pay off. Azure, its AI cloud product, saw revenue rise 40% in fiscal Q3, beating estimates. Overall, its cloud revenue rose 29%, which was better than the 25% revenue increase in its Q2. And Microsoft had $627 billion in backlog in Q3 ended March 31, up 99% for the previous year's quarter.
In its outlook, management said Azure growth will be around 40% in Q4, showing some "modest acceleration" in the second half of the year.
The reacceleration is due to the data centers Microsoft is building to expand capacity to handle the high demand. CEO Satya Nadella said, "We are moving aggressively to add capacity aligned to our demand signals we see."
CFO Amy Hood said something similar on the previous quarter's earnings call, stating, "I think it's probably better to think about the Azure guidance that we give as an allocated capacity guide about what we can deliver in Azure revenue." In other words, it is building to meet real demand, not out of hope that demand will come.
Also, Nadella said in the Q3 earnings release that Microsoftʻs AI business has an annual revenue run rate of $37 billion -- up 123% year over year. That's real revenue growth from AI, not speculation, showing that the spending is paying off.
Microsoft's stock is cheap Another point is that Microsoft recently revised its agreement with OpenAI. With the new agreement, OpenAI is no longer an exclusive AI provider, and Microsoft no longer pays revenue share to OpenAI. The change reduces Microsoft's overall exposure to OpenAI, which should open doors for new revenue opportunities.
Microsoft should also get a revenue bump from updated pricing and packaging for Microsoft software in concert with an approaching new five-year cycle for many of its Office clients.
This all comes at a time when Microsoft stock is historically cheap, trading at just 22 times earnings and 19 times forward earnings. That's below the S&P 500 average.
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It's also right around the cheapest Microsoft stock has been since 2018. The only time the price-to-earnings (P/E) ratio was below 22 since 2018 was this past March, when it was 21.
Microsoft is a screaming buy at this valuation, and most analysts agree. Some 95% of analysts rate Microsoft stock as a buy with a median price target of $550 per share. That would suggest 41% upside over the next 12 months.
If Microsoft has a strong Q4 when it reports on July 29 and a robust outlook -- both of which I expect -- it could be the launching pad for a solid run by Microsoft stock.
Big tech hyperscalers like Amazon, Alphabet, Microsoft, and Meta are positioned for significant free cash flow growth as CapEx investments begin to yield returns post-2028. Semiconductor and memory stocks have led the market, but expectations are now high, making risk-to-reward more attractive in hyperscalers and select software names.
WHY: Rosen Law Firm, a global investor rights law firm, reminds purchasers of common stock of Microsoft Corporation (NASDAQ: MSFT) between May 1, 2025 and January 28, 2026, inclusive (the “Class Period”), of the important August 11, 2026 lead plaintiff deadline.
SO WHAT: If you purchased Microsoft common stock during the Class Period you may be entitled to compensation without payment of any out of pocket fees or costs through a contingency fee arrangement.
WHAT TO DO NEXT: To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action. A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than August 11, 2026. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation.
WHY ROSEN LAW: We encourage investors to select qualified counsel with a track record of success in leadership roles. Often, firms issuing notices do not have comparable experience, resources, or any meaningful peer recognition. Many of these firms do not actually handle securities class actions, but are merely middlemen that refer clients or partner with law firms that actually litigate the cases. Be wise in selecting counsel. The Rosen Law Firm represents investors throughout the globe, concentrating its practice in securities class actions and shareholder derivative litigation. Rosen Law Firm has achieved the largest ever securities class action settlement against a Chinese Company. Rosen Law Firm was Ranked No. 1 by ISS Securities Class Action Services for number of securities class action settlements in 2017. The firm has been ranked in the top 4 each year since 2013 and has recovered billions of dollars for investors. In 2019 alone the firm secured over $438 million for investors. In 2020, founding partner Laurence Rosen was named by law360 as a Titan of Plaintiffs’ Bar. Many of the firm’s attorneys have been recognized by Lawdragon and Super Lawyers.
DETAILS OF THE CASE: According to the lawsuit, throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) Microsoft’s Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) Microsoft’s flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit (“GPU”) and central processing unit (“CPU”) capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development (“R&D”); and (4) as a result, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft’s Copilot offerings had lost market share to rival products, a trend that was increasing. When the true details entered the market, the lawsuit claims that investors suffered damages.
To join the Microsoft class action, go to https://rosenlegal.com/cases/microsoft-corporation/join or call Phillip Kim, Esq. toll-free at 866-767-3653 or email [email protected] for information on the class action.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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Attorney Advertising. Prior results do not guarantee a similar outcome.
-------------------------------
Contact Information:
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New York, NY 10016
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OpenAI CEO Sam Altman has struck big deals with Microsoft and Apple. Both of them have ended poorly. Kevin Dietsch/Getty Images A year ago, OpenAI seemed like it had an untouchable lead in the AI race.
It was by far the dominant AI platform for consumers. Competitors like Meta were scrambling — and spending a gazillion dollars on new hires — to catch up. Sam Altman had enough cash, and clout, to hire famed Apple designer Jony Ive to build him a mystery device meant to take on the iPhone Ive helped build.
Now the narrative has turned: OpenAI is now scrambling to catch up to rival Anthropic, which had focused on enterprise accounts instead of selling to individuals. Altman seems to constantly be reorganizing his leadership structure, and then reorganizing again. And Apple is suing OpenAI, claiming that Altman's company poached its employees and stole its secrets.
It's an open question whether OpenAI erred by focusing early on consumers instead of companies. Or whether it has the right executives in the right roles. You need time to see how all of that shakes out. (I've asked OpenAI if they want to weigh in on any of this.)
But we can focus on the Apple lawsuit right now. Because what's interesting to me isn't just the spectacle of one of the world's most powerful companies suing one of the world's most valuable startups (and, possibly dragging its legendary former employee into court as well, though Ive hasn't been named in the suit).
It's that this is the second time OpenAI has aligned itself with a leading tech giant, and ended up in a messy breakup.
That first rift was with Microsoft, which at one point appeared to be OpenAI's most crucial Big Tech ally. Microsoft first invested $1 billion in OpenAI way back in 2019, and then made a much bigger commitment in 2023, months after OpenAI ushered in a new era of AI with ChatGPT. When Altman was temporarily fired by his board later that year, Microsoft CEO Satya Nadella provided crucial backing for Altman in his negotiations to take back his job.
But by April of this year, Microsoft and OpenAI had more or less broken up. They still have a deal, but the exclusive relationship they'd forged a few years earlier is now formally non-exclusive. Of note: That deal came weeks after a report that Microsoft was considering suing OpenAI for allegedly breaching their existing contract.
The Apple/OpenAI story isn't a carbon copy of the Microsoft/OpenAI story, but it rhymes.
In 2024, Apple blessed OpenAI's status as the dominant AI company by giving it pole position on the iPhone: Apple wasn't forcing its users to use ChatGPT, but it was going to integrate the chatbot into its phone software. It seemed like a win for both companies.
Then OpenAI bought Ive's company for $6.5 billion, and announced plans to build a mystery device that isn't supposed to be an iPhone but is also clearly meant to compete with the iPhone in some way. And by May of this year, OpenAI executives were so disappointed with their Apple tie-up that they were reportedly considering suing Tim Cook's company for breach of contract.
Instead, Apple is suing OpenAI.
I don't have an opinion about the merits of Apple's case. So far, we only have Apple's (preliminary) side of the story. And there are plenty of observers, including my colleague Alistair Barr, who aren't particularly sympathetic to Apple.
It's also not the first time Apple has used the court system to fight a would-be iPhone challenger: While it didn't sue Google directly, in 2011 it did sue Samsung, which was using Google's Android software to build an iPhone rival.
But I think it's remarkable that OpenAI has struck two very important alliances with Big Tech giants, and both of them have ended in acrimony.
A seen-it-all perspective would be to argue that fighting with Big Tech companies is a sign that you may be a Big Tech company yourself. And that all of these guys have enormous resources, and lawsuits take forever to play out, and by the time they do, the world may have changed so radically that the initial fight becomes pointless. We're all adults here, let's move on.
But if you're a Big Tech executive who's working with OpenAI, or considering it, you may have already had concerns about the company's leadership. This week's news may give you even more reasons to fret.
Read next
Peter Kafka You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Peter covers media and technology for Business Insider; previously he has worked at Vox, Recode, AllThingsD, and Forbes. He was also the first hire at Silicon Alley Insider, Business Insider's predecessor.
AI OpenAI Sam Altman More lawsuit Apple Microsoft Tim Cook
Microsoft (MSFT +2.02%) is having an uncharacteristically bad year thus far in 2026. Entering trading this week, it's down around 20% as the market has been bearish on software stocks as a whole, related to concerns about artificial intelligence (AI). Rightly or wrongly, Microsoft's stock has struggled to turn things around.
Later this month, however, on July 29, the company reports its all-important earnings numbers. They will be particularly crucial as they will also be its year-end numbers, and its guidance for the year ahead could be of most importance to investors, as it may offer proof that the business isn't in as bad a shape as its recent stock performance might suggest.
While Microsoft's stock isn't trading at its 52-week low anymore, its valuation remains modest. Is now a good time to buy the tech stock, before it posts its latest numbers?
Image source: Getty Images.
Microsoft's track record hasn't been good of late When a company releases its latest earnings numbers, it can have a significant impact on its share price. Unfortunately, in Microsoft's case, the last three times it posted earnings, the stock would proceed to fall in value, sometimes sharply.
MSFT data by YCharts
While this might seem bad, expectations may also be a bit lighter for the business going into the upcoming earnings release, given how much negativity may be priced in at this stage. Recently, Microsoft also announced significant layoffs and a "reset" for its Xbox business amid underwhelming results. Between AI-related concerns, worries of cloud business Azure slowing down, and now an Xbox turnaround, there are an increasing number of things that investors will be watching for when Microsoft reports its latest earnings numbers this month.
Why Microsoft stock still looks worth buying, despite the uncertainty Buying a stock based on how it might do when it releases earnings is dangerous and risky. A company can post strong numbers, and there may still be something that the market didn't like about the guidance or some commentary that came out. The market can be fickle that way. And just because the stock has a good or bad track record after earnings in the past doesn't mean that trend will continue.
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Investing based on fundamentals and focusing on a long-term outlook is going to yield safer results for investors than looking at just the short term. Whether or not Microsoft beats expectations for the current quarter is irrelevant. What matters is that with a reasonable valuation (the stock trades at 23 times its trailing earnings), a robust business, and promising growth opportunities, Microsoft can make for a fantastic stock to buy right now.
LOS ANGELES, July 13, 2026 (GLOBE NEWSWIRE) -- Glancy Prongay Wolke & Rotter LLP reminds investors of the upcoming August 11, 2026 deadline to file a lead plaintiff motion in the class action filed on behalf of investors who purchased or otherwise acquired Microsoft Corporation (“Microsoft” or the “Company”) (NASDAQ: MSFT) common stock between May 1, 2025 and January 28, 2026, inclusive (the “Class Period”).
IF YOU SUFFERED A LOSS ON YOUR MICROSOFT INVESTMENTS, CLICK HERE TO INQUIRE ABOUT POTENTIALLY PURSUING CLAIMS TO RECOVER YOUR LOSS UNDER THE FEDERAL SECURITIES LAWS.
What Happened?
On January 28, 2026, Microsoft announced disappointing results for its second quarter of fiscal 2026, revealing that growth of its cloud computing platform, Azure, had slowed suddenly and fallen below analyst expectations due primarily to computational capacity constraints, as the Company had diverted central processing unit and graphics processing unit capacity to applications for its generative AI chatbot, Copilot, and AI-related research and development. The Company also revealed that its capital expenditures had increased to $37.5 billion during the quarter, causing the Company’s capital expenditures for the first six months of fiscal 2026 to expand to $72.4 billion compared to $88.2 billion for the entirety of fiscal 2025, largely due to AI-related research and development and Copilot development and capacity buildout costs. Additionally, Microsoft disclosed that the amount of paying users of Copilot was well below analyst estimates.
On this news, Microsoft’s stock price fell $48.13, or 9.99%, to close at $433.50 per share on January 29, 2026, thereby injuring investors.
What Is The Lawsuit About?
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that Microsoft’s Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) that Microsoft’s flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) that Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; (4) that, as a result of the foregoing, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company’s Copilot offerings had lost market share to rival products, a trend that was increasing; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
If you purchased or otherwise acquired Microsoft common stock during the Class Period, you may move the Court no later than August 11, 2026 to request appointment as lead plaintiff in this putative class action lawsuit.
Contact Us To Participate or Learn More:
If you wish to learn more about this action, or if you have any questions concerning this announcement or your rights or interests with respect to these matters, please contact us:
Charles Linehan, Esq.,
Glancy Prongay Wolke & Rotter LLP,
1925 Century Park East, Suite 2100,
Los Angeles California 90067
Email: [email protected]
Telephone: 310-201-9150,
Toll-Free: 888-773-9224
Visit our website at www.glancylaw.com.
Follow us for updates on LinkedIn, Twitter, or Facebook.
If you inquire by email, please include your mailing address, telephone number and number of shares purchased.
To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
Contact Us:
Glancy Prongay Wolke & Rotter LLP,
1925 Century Park East, Suite 2100
Los Angeles, CA 90067
Charles Linehan
Email: [email protected]
Telephone: 310-201-9150
Toll-Free: 888-773-9224
Visit our website at: www.glancylaw.com.
NEW YORK, July 13, 2026 (GLOBE NEWSWIRE) -- Levi & Korsinsky, LLP announces that a securities class action has been filed against Microsoft Corporation (NASDAQ: MSFT).
YOU MAY BE AFFECTED IF YOU:
Purchased MSFT stock between May 1, 2025, and January 28, 2026Lost money on your Microsoft investment Submit your information to recover losses or contact Joseph E. Levi, Esq. at [email protected] or (212) 363-7500.
Microsoft shares traded above $550 during the Class Period as executives repeatedly touted Copilot as "best-in-class" with accelerating adoption. When concealed problems surfaced, investors who purchased at artificially inflated prices suffered significant losses. The lead plaintiff deadline is August 11, 2026.
What They Allegedly Knew Before Shareholders Did
The securities action alleges that while Microsoft's most senior officers were publicly celebrating record Copilot seat additions and claiming "best-in-class" AI capabilities, the Company's AI product suite was experiencing severe internal problems that were never disclosed to investors:
Brand positioning confusion across multiple Copilot versions with different features, names, and use cases left enterprise customers unable to distinguish productsSignificant data siloing prevented Copilot from accessing enterprise information across platforms, undermining the "Work IQ" advantage executives publicly promotedComputational capacity constraints limited Copilot's ability to deliver the agentic workflows and deep reasoning capabilities described at investor conferencesOrganizational dysfunction between teams responsible for different Copilot products created interoperability failures that degraded the user experienceThe circularity of multibillion-dollar arrangements with Open AI (250 billion Azure commitment) and Anthropic (30 billion compute commitment) masked concentration risk rather than demonstrating genuine market demand
The Red Flags That Emerged
The complaint chronicles a pattern where public statements grew increasingly aggressive even as internal problems allegedly intensified. In September 2025, management claimed "70% of the Fortune 500" used Copilot "in a pretty extensive way." By October 2025, that figure was revised upward to "90% of the Fortune 500." The action contends these adoption metrics obscured the reality that usage intensity, retention, and actual enterprise value delivery were falling short of what investors were led to believe.
Meanwhile, the Company announced plans to increase total AI capacity by 80% and roughly double its data center footprint over two years. The lawsuit maintains these massive capital commitments were presented as evidence of demand when they actually reflected supply-side build-out whose returns were far less certain than represented.
Inside Knowledge vs. Public Statements
As set forth in the complaint, each individual defendant occupied a position with direct visibility into Copilot's operational performance. The action alleges they were privy to proprietary information about usage metrics, customer feedback, product deficiencies, and competitive positioning that contradicted their optimistic public statements. Despite this alleged knowledge, they continued to describe Copilot's trajectory in superlative terms at earnings calls, investor conferences, and the Company's Annual Shareholders Meeting.
"The timeline raises important questions about when certain risks were known internally versus when they were disclosed to the investing public," stated Joseph E. Levi, Esq.
Act now to protect your rights or call (212) 363-7500.
ABOUT THE FIRM — Levi & Korsinsky represents investors in securities class actions nationwide, with a track record of recovering hundreds of millions for shareholders harmed by alleged corporate concealment. Ranked among ISS Top 50 for seven consecutive years. Lead plaintiff applications must be submitted by August 11, 2026.
Frequently Asked Questions About the MSFT Lawsuit
Q: When did Microsoft allegedly mislead investors? A: The class period runs from May 1, 2025 to January 28, 2026. The alleged fraud was revealed through corrective disclosures causing significant stock decline.
Q: What specific misstatements does the MSFT lawsuit allege? A: The complaint alleges Microsoft made materially false or misleading statements regarding the success, adoption, and performance of its Copilot AI products and the returns on its multibillion-dollar AI investments during the class period. When the true state was revealed, the stock price declined sharply.
Q: What do MSFT investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at [email protected] or (212) 363-7500. No immediate action is required to remain eligible as a class member.
Q: What if I already sold my MSFT shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the class period and sold at a loss may still participate.
Q: Do I need to go to court or give testimony? A: No. The overwhelming majority of class members never appear in court or give depositions. You submit a claim form to receive your portion of recovery.
Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.
Q: What if I missed the lead plaintiff deadline? A: The deadline applies only to investors seeking lead plaintiff appointment. Class members who miss it can still participate in any settlement or recovery.
CONTACT:
Levi & Korsinsky, LLP
Joseph E. Levi, Esq.
Ed Korsinsky, Esq.
33 Whitehall Street, 27th Floor
New York, NY 10004 [email protected]
Tel: (212) 363-7500
Fax: (212) 363-7171
by Kurt Schlosser on Jul 13, 2026 at 8:55 amJuly 13, 2026 at 8:55 am
The lifelike avatar of President Theodore Roosevelt, which relies on artificial intelligence to answer visitors’ questions, at the Theodore Roosevelt Presidential Library in Medora, N.D. (Theodore Roosevelt Presidential Library Photo via Microsoft) “Speak softly and carry a big prompt.”
That’s a bit of a hallucination of Theodore Roosevelt’s famed ideology, but a digital version of the 26th president of the United States is definitely worth talking to thanks to Microsoft technology.
With the opening of the new Theodore Roosevelt Presidential Library in Medora, N.D., earlier this month, visitors can interact with a lifelike, AI-powered avatar of Roosevelt and ask questions about his life, leadership and legacy.
The exhibit has attracted visits from President Trump — separated from Roosevelt by 125 years — and presidential historian Doris Kearns Goodwin, who accompanied Microsoft President Brad Smith.
“Who better to put our avatar to the test than American historian Doris Kearns Goodwin,” Smith wrote on LinkedIn on Sunday, where he shared a video of a clearly giddy Goodwin interacting with the Roosevelt avatar.
“I’ve been wanting to meet you for such a long time,” Goodwin said. “I feel like I’ve lived with you for 10 years of my life when I wrote a first book about you.”
AI Roosevelt answered a few questions from Goodwin thanks to Box 1, the knowledge base backbone of the museum, powered by technology Microsoft helped create. According to a July 1 Microsoft blog post, the system is loaded with hundreds of thousands of archival documents, and AI is used to “organize, enrich and reconstruct fragmented materials into searchable, contextualized historical records.”
Box 1 and AI also power The Campfire Reading Room, a digital research tool that anyone anywhere in the world can use to search through Roosevelt’s writings, letters, images and historical materials.
Microsoft donated much of its work with the library through its AI for Good Lab. The company said it plans to release a paper documenting exactly how the technology works and to open source the software used in the project.
As technology evolves, the library will evolve with it, Microsoft said. When more documents are added to Box 1 or as generative AI improves, the Roosevelt avatar will automatically update with the additional context.
The goal is to leverage AI to help the institution speak directly to future generations.
“That’s why we call it a living library,” said Laura Hoffman, senior director of the AI for Good Lab. “One of the most challenging things for cultural institutions is to continue to keep their experiences feeling relevant and fresh. This is what’s great about AI technology: It will continue to get better and better.”
New York, New York--(Newsfile Corp. - July 13, 2026) - Bronstein, Gewirtz & Grossman, LLC, a nationally recognized investor-rights law firm, announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ: MSFT) and certain of its officers.
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Microsoft securities between May 1, 2025 and January 28, 2026, both dates inclusive (the "Class Period"). Such investors are encouraged to join this case by visiting the firm's site: bgandg.com/MSFT.
Microsoft Case Details
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements because they failed to disclose that:
Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and as a result of the above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing.What's Next for Microsoft Investors?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm's site: bgandg.com/MSFT, or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 917-590-0911. If you suffered a loss in Microsoft you have until August 11, 2026, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
No Cost to Microsoft Investors
We, Bronstein, Gewirtz & Grossman LLC, represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys' fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman, LLC for Microsoft Securities Class Action?
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide. More at www.bgandg.com
"Our practice centers on restoring investor capital and ensuring corporate accountability, which serves to uphold the essential integrity of the marketplace," said Peretz Bronstein, Founding Partner of Bronstein, Gewirtz & Grossman, LLC.
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Prior results do not guarantee similar outcomes.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/301529
Source: Bronstein, Gewirtz & Grossman, LLC
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From Ballmer’s Shadow to a Cloud-and-AI Empire When Satya Nadella took over as CEO on February 4, 2014, Microsoft was still viewed as a Windows-and-Office licensing dinosaur. Microsoft (NASDAQ:MSFT | MSFT Price Prediction) traded near $30.03 on a split-adjusted basis that day. Today, it anchors the artificial intelligence (AI) buildout.
Nadella pivoted the culture, bet the balance sheet on Azure, moved Office to a Microsoft 365 subscription, and bought LinkedIn, GitHub, and Activision Blizzard. The OpenAI partnership, seeded with $1 billion in 2019, was restructured to a roughly 27% stake valued near $135 billion, with OpenAI committing to an incremental $250 billion in Azure services. Azure now runs at over a $75 billion annualized pace, and the AI business alone is at a $37 billion run rate, up 123% year over year.
What a $10,000 Stake Became Using split-adjusted prices, here is how the math shakes out across standard horizons versus the S&P 500.
Since Nadella’s First Day
Initial Investment: $10,000 (roughly 333 shares at $30.03) MSFT Total Return: 1,182.42% Current value: $128,242 S&P 500 (same period): 330.44% Microsoft S&P 500 1-Year Return −22.59% 20.63% 5-Year Return 44.39% 73.34% 10-Year Return 718.59% 251.22% A $10,000 stake placed on Nadella’s first day is now worth many multiples of the original, before dividends. But the recent picture is ugly. Microsoft has slid from a 52-week high of $555.45 to $385.10, dragged by fears that capital expenditures of $30.88 billion (+84% year over year) will crimp free cash flow before AI revenue catches up. The five-year window even trails the S&P 500.
Grading Nadella, and the Succession Question We have to give Nadella an A+. He inherited a roughly $300 billion company and built a $2.86 trillion one while lifting the quarterly dividend from $0.28 to $0.91. There is no confirmed news of any departure, but given his dual chair-and-CEO role, succession chatter is inevitable. A handoff to a proven operator like Scott Guthrie or Kevin Scott would likely reassure the market; a surprise external hire might not.
The Bull and Bear Case From Here The bull case rests on the AI capex cycle producing durable Azure margin. Analysts are overwhelmingly bullish, and their mean price target is all the way up at $559.86, on a forward P/E near 21. The bear case builds if capital spending keeps climbing while Azure growth slips below 30%, which would signal that AI return on investment is stretching further out. Because Microsoft’s cloud business is growing fast and it has a massive backlog of guaranteed future revenue, the stock looks attractive at its current price.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Microsoft didn't make the cut. Grab the names FREE today.
08 July 2026, Bavaria, Munich: The Microsoft logo and lettering can be seen on the building housing the headquarters of Microsoft Deutschland GmbH in Parkstadt Schwabing in Munich (Bavaria, Germany). Microsoft Corporation is the world's largest software manufacturer and one of the largest companies in the world. (Symbolic image, stock photo, illustration, symbolic photo, illustrative photo, thematic image, general image, thematic photo) Photo: Matthias Balk/dpa (Photo by Matthias Balk/picture alliance via Getty Images)
dpa/picture alliance via Getty Images
This article was written by Doug Nathman, with research by his team at Trefis.
In the realm of major technology players, Microsoft is showcasing impressive growth and profit figures, yet its valuation indicates it is more of a contender than the champion.
Microsoft (MSFT) provides the digital solutions that power contemporary businesses, ranging from its Azure cloud services to the AI-enhanced Office applications used on countless desktops. Nevertheless, following a year in which its shares dropped -22% while the overall market advanced, it finds itself in an unusual position among its technology peers. While the company showcases some of the best growth and profitability metrics in the sector, its stock is valued relatively low compared to others in the group. Is Microsoft simply a better option within a less expensive field, or is the market sensing some underlying weakness?
Should A High Achiever Have A Mid-Level Valuation?The figures indicate a distinct disparity. Over the past year, Microsoft’s revenue has surged by 17.9%, exceeding Apple’s (AAPL) growth of 12.8% and Amazon’s (AMZN) 14.2%. Its operating margin stands at 47%, placing it among the top contenders, well above Alphabet’s 33% and Apple’s 33%. In light of this operational success, the market has assigned Microsoft a price-to-earnings ratio of 22.8 times. This is a notable discount compared to Apple, which is valued at 37.9 times earnings, despite showing slower growth and lower margins.
This isn’t an isolated instance. When compared to Alphabet (GOOG), Microsoft demonstrates comparable revenue growth, but with a significantly higher operating margin, yet it continues to trade at a lower multiple. The market rates Microsoft’s operational performance near the top of its competitive set while placing its stock price near the bottom. This kind of incongruity warrants further business insight.
MSFT Stock vs. Peers
Trefis
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The Market Assigns A $190 Billion UncertaintyThe market acknowledges the impressive outcomes; instead, it is considering the considerable expenses involved in achieving future expansion. The core argument among investors revolves around a "disconnect that raises some concerns" regarding the pace of CapEx growth compared to revenue acceleration, as mentioned by one analyst during its recent call. Management has quantified this investment, stating they "anticipate investing approximately $190 billion in capital expenditures" for the year 2026 to support its AI initiatives.
This situation presents a genuine challenge. The market’s valuation reflects significant skepticism about the returns from such a massive investment. While the company’s AI segment is growing at an impressive rate, exceeding an annual run rate of $37 billion, the costs associated with this growth are substantial. Investors are evaluating whether the new "seats plus consumption" models for tools like Microsoft Copilot can yield sufficient high-margin revenue to validate the substantial expenditures, especially when general IT budgets are not necessarily increasing. The matter of what could genuinely drive the stock upward from this point rests on the success of this capital-heavy strategy.
The Azure Growth Rate Will Determine The OutcomeManagement maintains a strong outlook, projecting "another year of double-digit growth in revenue and operating income for FY ’27." The bullish perspective suggests that this expenditure is critical to seizing a once-in-a-generation opportunity, with Microsoft Cloud revenues already surpassing $54 billion last quarter, reflecting a year-over-year growth of 29%. The organization is laying the groundwork for an AI-driven economic framework and is confident that returns will follow.
The most crucial metric to monitor is the growth rate of Azure, the engine supporting this growth. All investments in data centers and GPUs need to result in a surge in cloud usage. Thus, the benchmark is management’s own forecast. They "expect Azure growth to exhibit slight acceleration." If that acceleration comes to fruition, it will indicate that the investment is paying off. Conversely, if it fails to materialize, the market's cautious valuation will have been vindicated.
This article explored one angle; our comprehensive peer-by-peer dashboards for MSFT present every metric side by side, with daily updates.
Choosing The Top Performer Still Leaves You With Just One Stock
Evaluating a company alongside its competitors clarifies the scenario -- however, irrespective of which company tops the list, holding a significant stake in a single entity constitutes a concentrated risk. Divesting from a large position in the conventional way entails a tax implication. There is a method to safeguard the position while efficiently diversifying without incurring taxes.
NEW YORK, July 13, 2026 (GLOBE NEWSWIRE) -- Leading securities law firm Bleichmar Fonti & Auld LLP announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ:MSFT) and certain of the Company’s senior executives for securities fraud after its significant stock drop resulting from potential violations of the federal securities laws.
If you invested in Microsoft, you are encouraged to obtain additional information by visiting: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
Key Details of the Microsoft ($MSFT) Class Action:
Lead Plaintiff Deadline: August 11, 2026Alleged Misconduct: Securities fraud alleging that Microsoft misled investors regarding its Azure cloud computing platform and AI chatbot CopilotStock Drop: January 28, 2026 – 10% Stock DropCourt: U.S. District Court for the Western District of WashingtonAction: Contact BFA Law to discuss your rights Investors have until August 11, 2026 to ask the Court to be appointed to lead the case. The complaint asserts securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Microsoft common stock. The class action is pending in the U.S. District Court for the Western District of Washington. It is captioned City of St. Clair Shores Police and Fire Retirement System, et al., No. 26-cv-02071.
Why is Microsoft Being Sued for Securities Fraud?
Microsoft is a multinational technology company that develops software, cloud services, and devices. In recent years, Microsoft’s cloud computing platform named Azure has been Microsoft’s main growth driver. A key reason for Azure’s recent growth is Microsoft’s multi-billion-dollar investment into AI, including the development of its own generative AI chatbot named Copilot.
According to the complaint, during the relevant period, Microsoft consistently touted Copilot’s best-in-class capabilities, which purportedly drove widespread and growing user adoption. Copilot’s apparent success allowed Microsoft to report surging Azure-related revenue.
As alleged, in truth, Copilot suffered from severe functionality issues that caused user adoption to decline and put Microsoft’s Azure revenue at risk.
Why did Microsoft’s Stock Drop?
On January 28, 2026, Microsoft announced disappointing 2Q 2026 financial results and that Azure growth had slowed suddenly. Microsoft also allegedly revealed for the first time that the number of Microsoft 365 Copilot premium customers totaled only 15 million, materially below analyst estimates.
This news caused the price of Microsoft common stock to decline $48.13 per share, or 10%, from $481.63 per share on January 28, 2026, to $433.50 per share on January 29, 2026.
Additionally, on February 3, 2026, The Wall Street Journal reported in an article titled “Microsoft’s Pivotal AI Product Is Running Into Big Problems” that severe challenges and functionality issues had plagued Copilot, causing the application to lose market share. Specifically, The Wall Street Journal reported that “[c]onfusing brand positioning and interoperability problems have frustrated users.”
Click here for more information: https://www.bfalaw.com/cases/microsoft-class-action-lawsuit.
What Can You Do?
If you invested in Microsoft, you may have legal options and are encouraged to submit your information to the firm.
All representation is on a contingency fee basis; there is no cost to you. Shareholders are not responsible for any court costs or expenses of litigation. The firm will seek court approval for any potential fees and expenses.
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It has been named a top plaintiff law firm by Chambers USA, The Legal 500, and ISS SCAS, and its attorneys have been named “Elite Trial Lawyers” by the National Law Journal, “Litigation Stars” by Benchmark Litigation, among the top “500 Leading Plaintiff Financial Lawyers” by Lawdragon, “Titans of the Plaintiffs’ Bar” by Law360 and “SuperLawyers” by Thomson Reuters.
Most recently, The Legal 500 awarded BFA the most client satisfaction accolades of any plaintiff’s securities litigation law firm, with clients noting: “[t]here is no better service provider in the practice area,” “[t]he interest of the client is always front and center,” and “[t]here isn’t a better firm in this space.” One testimonial described the firm as “nimble and entrepreneurial,” with a “relentless focus on adding value for clients.”
Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.’s Board of Directors, as well as $420 million from Teva Pharmaceutical Ind. Ltd.
For more information about BFA and its attorneys, please visit https://www.bfalaw.com.
Starbucks vyvíjí interní nástroje s pomocí umělé inteligence, které by mohly nahradit některé softwarové aplikace, jež v současnosti nakupuje od společností Microsoft a IBM. Podle interní prezentace, kterou získala agentura Bloomberg, kavárenský řetězec vytváří alternativy k systému Microsoftu pro sledování zásob a k nástroji IBM pro správu údržby. Některé z těchto interně vyvinutých řešení by mohly být nasazeny do konce příštího roku, pokud testování dopadne úspěšně.
Po mnoho let byly firmy silně závislé na svých technologických dodavatelích kvůli obavám z narušení provozu a složitosti vývoje vlastních systémů. Umělá inteligence však tuto situaci mění, protože usnadňuje vytváření aplikací od základu a zároveň firmy motivují zaměstnance k využívání těchto technologií.
Přední softwarové společnosti čelí rostoucím obavám ohledně toho, zda dokážou odolávat konkurenci ze strany produktů vytvářených startupy nebo dokonce jejich vlastními zákazníky za pomoci AI. Tento trend letos negativně doléhá na akcie softwarových firem. Jak Microsoft, tak IBM výrazně zaostávají za indexem S&P 500 a jsou od počátku roku v červených číslech.
Starbucks utratí ročně přibližně 400 milionů dolarů pouze za software, uvedl technologický ředitel společnosti Anand Varadarajan během interního setkání se zaměstnanci na začátku letošního roku. Podle záznamu schůzky, který Bloomberg přezkoumal, Varadarajan uvedl, že existují jasné příležitosti ke snížení výdajů na software.
Vlastní software může být levnější, což je významná motivace pro společnosti jako Starbucks, která se v rámci širší strategie obnovy snaží snížit náklady o dvě miliardy dolarů. Z dlouhodobého hlediska však vlastní vývoj může vést k vyšším nákladům na údržbu a pracovní sílu.
Podle prezentace společnost v oblasti technologií přezkoumává „každou smlouvu a každou službu“. V některých případech to znamená vyvíjet vlastní produkty jako náhradu za software, který musí její inženýři stejně rozsáhle upravovat podle vlastních potřeb.
Podle osob obeznámených se situací, které nebyly oprávněny veřejně hovořit, Starbucks již několik let pracuje na vývoji pokladního systému (point-of-sale system), který by nahradil řešení Oracle Simphony.
Starbucks se k celé záležitosti odmítl vyjádřit. Ve svém blogovém příspěvku z počátku roku společnost uvedla, že umělá inteligence a další technologické inovace podpoří její dlouhodobý růst a umožní baristům věnovat více času zákaznickému servisu.
Podle interní prezentace hrálo klíčovou roli při vývoji platformy, která by mohla nahradit nástroj IBM, programování s podporou AI. Starbucks zároveň aktivně podporuje technologické pracovníky v používání umělé inteligence a podle dřívějších informací agentury Bloomberg dokonce hodnotí její využívání jako součást systému bonusů.
Přesto existuje skepse ohledně toho, nakolik a jak rychle dokáže AI urychlit a automatizovat práci. Starbucks například nedávno stáhl systém pro sledování zásob v prodejnách založený na AI a vrátil se k manuálnímu počítání. Společnost také nadále využívá software od externích dodavatelů, včetně produktů společnosti Microsoft.
Tým podnikových technologií Starbucks je podle interní prezentace na cestě snížit svůj rozpočet přibližně o 30 milionů dolarů ve fiskálním roce končícím koncem září. Z toho asi 10 milionů dolarů představují úspory ve výdajích na software.
Dalších 13 milionů dolarů společnost ušetří především omezením spolupráce s externími kontraktory z poradenských a profesionálních služeb a nahrazením některých pozic vlastními zaměstnanci.
Starbucks zároveň buduje technologická pracoviště v Nashvillu a v Indii, kde bude část technologických pracovníků působit. Další zaměstnanci zůstanou v centrále společnosti v Seattlu. Od února loňského roku firma zrušila přibližně 2 300 pracovních míst, včetně mnoha pozic v technologických týmech.
Satya Nadella said that it was hypocritical for model makers to complain about distillation. Bloomberg/Getty Images Satya Nadella took a quiet swipe at AI labs like Anthropic for how they train their models.
In an X post on Sunday, the Microsoft CEO said that model makers complaining about distillation is hypocritical. Distillation is the process of training a less powerful model based on the outputs of a stronger one.
"While the great innovation that comes from model providers having fair use rights to train models on public data is needed, I find it ironic that the status quo is to then turn around and impose restrictive terms on distillation, and to reserve the right to learn from customer usage and interaction data," Nadella wrote.
He added that if learning only flows in one direction, owners of the learning infrastructure make all the money while creators of the knowledge get left out.
Frontier AI model makers like Anthropic, OpenAI, and Google DeepMind rely on work created by others to train their own models. ChatGPT, Claude, and Gemini acquire their "intelligence" from publicly available writing, images, and other data. Numerous companies and individuals have sued the leading AI labs over nonconsensual content "scraping."
Though the lab was not named, Nadella's comments seemed especially targeted toward Anthropic. Earlier this year, Anthropic CEO Dario Amodei complained that Chinese model makers are stealing his company's work, using Claude to train their own models.
Last month, Anthropic wrote a letter to South Carolina Sen. Tim Scott and Massachusetts Sen. Elizabeth Warren saying that Alibaba had recently carried out "the largest known distillation attack" on it to date.
"Competitors can use it to acquire powerful capabilities from other labs in a fraction of the time, and at a fraction of the cost, that it would take to develop them independently," Anthropic said in a lengthy statement on the subject in February.
Alibaba did not publicly respond to Anthropic's accusations at the time.
In Sunday's blog post, Nadella warned that companies relying on leading models are essentially handing over their proprietary data and then paying to use them.
He said companies should own their AI infrastructure and institutional knowledge rather than rely on any single model vendor. They should also conduct their own evaluations and their own "learning loop," allowing their AI capabilities to improve continuously over time.
"That is why enterprises need a real trust boundary for their human capital and token capital to compound," he said. "And it is a hard boundary across which nothing crosses, not even the intelligence exhaust, without consent."
Elon Musk has also criticized Anthropic for how it collects data and trains its models.
"Anthropic is guilty of stealing training data at massive scale and has had to pay multi-billion dollar settlements for their theft. This is just a fact," Musk wrote in a February X post, following Anthropic's complaint against Chinese models.
Anthropic did not immediately respond to a request for comment from Business Insider.
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Peter Gelling You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Peter Gelling is a Senior Editor and the Weekend Bureau Chief at Business Insider. He also still writes, mostly about the AI industry, universal basic income, the economy, campaign finance reform, geopolitics, and anything else that inspires him.He was previously the Geopolitics Editor at Quartz and a Senior Editor at GlobalPost. From 2005 to 2010, he was a correspondent for The New York Times based in Jakarta, Indonesia.
Shubhangi Goel You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
