New York, Jan 22, 2026, 09:32 ET — Regular session
- Microsoft shares climbed roughly 1% in early trading following news of a new partnership with Mercedes F1
- A U.S. Air Force contract notice revealed a $170.4 million task order awarded to Microsoft for Cloud One
- Wall Street is focused on Microsoft’s Jan. 28 earnings, seeking clues on Azure growth and AI investment
Shares of Microsoft Corp (MSFT.O) climbed roughly 1% to near $449 in early Thursday trading following Mercedes’ release of images of its 2026 Formula One car and a fresh partnership announcement with the tech giant.
Shares have slid this week as investors seek evidence that Microsoft’s ramp-up in data center spending is boosting Azure growth and generating fresh AI revenue. On Wednesday, the stock dropped 2.3% to $444.11, per published price data.
Recent analyst notes have shown caution on valuation, despite upbeat demand checks—a familiar pattern for a megacap AI stock ahead of earnings. Mizuho’s channel checks revealed solid public cloud trends and robust AI adoption. However, they also noted that end-of-period budget spending appears more moderate than usual.
Mercedes-AMG PETRONAS F1 Team announced a partnership to integrate Microsoft’s cloud and enterprise AI tools more deeply into their race operations, spanning from factory work to trackside decision-making. “Our sport is driven by those who lead through innovation,” said Mercedes team boss Toto Wolff. Microsoft commercial chief Judson Althoff added, “milliseconds matter and data determines outcomes.” Barchart.com
On Jan. 21, a U.S. Defense Department contracts notice revealed Microsoft snagged a $170,444,462 firm-fixed-price task order for the Air Force’s Cloud One program. The work is set to continue through Dec. 7, 2028. The notice specified the award was a sole-source acquisition.
Cloud One is a longstanding initiative delivering shared cloud services to military users. Microsoft’s recent contract win comes amid stiff competition from Amazon and Alphabet’s Google, both of which already provide elements of the program, according to industry publication Data Center Dynamics.
Rothschild & Co Redburn analyst Alex Haissl lowered Microsoft’s price target to $450 from $500, maintaining a Neutral rating, a report by TheFly revealed.
Risks lurk on the horizon. Microsoft’s AI expansion has investors zeroing in on margins and service reliability. On Wednesday, the company addressed reported problems impacting Microsoft 365 services like Teams and Outlook, according to a post highlighted by Tom’s Guide.
Risk appetite gained ground Thursday following U.S. data that revised third-quarter economic growth up to a 4.4% annual rate, according to a Reuters report. This adjustment could influence rate expectations and the mood around big tech.
For Microsoft, the immediate focus isn’t on landing flashy new partnerships but on those two familiar drivers: Azure and AI. Traders have shown a tendency to offload shares whenever guidance points to slower cloud bookings or increased spending.
The competitive landscape remains tough. Enterprise cloud contracts and government projects often switch between Microsoft, Amazon’s AWS, and Google Cloud, with pricing pressure cropping up even when demand holds firm.
Microsoft’s fiscal Q2 earnings drop on Wednesday, Jan. 28, is the next major event. The earnings call is set for 2:30 p.m. Pacific, featuring CEO Satya Nadella and CFO Amy Hood.
