Microsoft Stock Climbs 1.20% as $35B AI Push and Trendline Break Signal Revival
Microsoft Corp (NASDAQ: MSFT) gained 1.20% on Friday, closing at $491.25, after fresh AI product rollouts, new enterprise partnerships..
Quick overview
- Microsoft's stock rose 1.20% to $491.25, driven by new AI product rollouts and enterprise partnerships.
- Despite a record $35 billion in capital expenditure, analysts remain optimistic about Microsoft's growth potential in AI and cloud services.
- Azure's revenue grew by 40%, exceeding expectations, although capacity constraints may limit future performance.
- Technical indicators suggest a potential upward trend for Microsoft, with key resistance levels to watch for further gains.
Microsoft Corp (NASDAQ: MSFT) gained 1.20% on Friday, closing at $491.25, after fresh AI product rollouts, new enterprise partnerships, and continued institutional buying helped restore confidence in the tech giant’s long-term growth path.
Even with the stock trading below its summer peak, analysts still see room for further gains as Microsoft deepens its expansion into AI infrastructure and cloud automation. Investors are watching closely to see how effectively the company balances soaring demand with the equally steep rise in operating costs.
Microsoft’s fiscal first-quarter results reignited debate over its aggressive spending strategy. The company disclosed nearly $35 billion in capital expenditure, its highest ever, far surpassing expectations and reversing earlier guidance of moderation. Shares dipped almost 4% in after-hours trading as markets reassessed the price tag of Microsoft’s ambitions.
Microsoft isn’t alone in facing pressure. Alphabet and Meta both warned that rising network and server costs are becoming unavoidable as AI models scale. Some analysts even suggested early parallels to dot-com-era excess, where valuations stretched ahead of real productivity gains.
OpenAI’s commitment to over $1 trillion in computing capacity further amplified concerns about how the industry will fund this next wave of AI acceleration.
Cloud Growth Drives Revenue Momentum
Despite the cost concerns, Microsoft’s core businesses continue to outperform. Azure posted 40% revenue growth from July to September, topping Visible Alpha’s 38.4% estimate. The company expects 37% growth this quarter, modestly above the Street’s forecast.
CFO Amy Hood noted that capacity limits held Azure back from even stronger performance, a constraint she expects will persist until at least mid-2026. For the current quarter, Microsoft guided total revenue between $79.5 billion and $80.6 billion, closely matching consensus.
Key Factors Supporting Microsoft’s Upside Potential:
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Strong Azure momentum despite bottlenecks
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Elevated AI demand across enterprise clients
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Long-term cloud adoption trends
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Deepening partnership ecosystem
Microsoft (MSFT) Technical Signals Turn Upward
Fresh technical signals now support Microsoft’s improving outlook. On the 4-hour chart, the stock has broken above its descending channel, a structure that guided the sell-off through November.
Price reclaimed the 20-EMA at $483.34, turning a former resistance line into short-term support. The rebound from $470.84 established a firm higher low, supported by a sequence of steady bullish candles.
A push above $500.37 would confirm a stronger trend reversal and open the path toward $512.37, with momentum supported by an RSI reading near 58, showing the up-move remains healthy and far from overextension. Should Microsoft maintain support above the 20-EMA, the stock could extend toward the mid-$500s, where broader supply sits.
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