Microsoft MSFT received a higher price target from J.P. Morgan, which lifted its 2027 target to $625 from $550 while maintaining an Overweight rating, citing expected growth across cloud services and artificial intelligence infrastructure, according to a Thursday analyst note.
Microsoft could benefit from increasing adoption of Copilot, its suite of AI-powered productivity tools. J.P. Morgan analyst Samik Chatterjee estimates stronger Copilot demand could contribute between $24 billion and $41 billion in additional revenue, before potential revenue from AI credit sales.
Microsoft's Azure cloud business is also expected to gain from continued investment in AI infrastructure. J.P. Morgan expects Azure growth to accelerate while margins in its Intelligent Cloud segment stabilize, which could support earnings growth.
Microsoft's AI infrastructure expansion serves both its own software products and outside customers, including enterprises and companies developing AI applications. J.P. Morgan said the combination could provide Microsoft with additional opportunities to monetize its growing computing capacity through cloud and software offerings.
