NEW YORK, May 29, 2026, 17:02 EDT
Microsoft shares rose over 5% on Friday, building on Thursday’s strong rally. Buyers cited optimism over artificial intelligence products, a big U.S. defense contract, and stronger signals from enterprise tech demand. The stock was last seen at $450.24, putting Microsoft’s market value near $3.35 trillion.
Microsoft wants investors to see that its push into artificial intelligence is starting to pay off, not just bump up data center costs. Reuters said Thursday that the company will roll out new in-house AI models, such as a coding model for GitHub Copilot, a move aimed at lowering its reliance on outside model providers.
Wall Street finished at record highs, pushed up by tech stocks. “There’s definitely euphoric sentiment in the market around AI,” said Ohsung Kwon, chief equity strategist at Wells Fargo, to Reuters. He noted earnings have fueled the move. Reuters
Microsoft is set to announce new models at its Build developer conference in San Francisco next week. According to the company’s events page, Build 2026 is slated for June 2–3 at Fort Mason Center. Reuters reported that Microsoft plans to debut models for transcription, reasoning, speech, and images. The company declined to comment to Reuters.
Microsoft is again in the AI-product spotlight. Reuters reported GitHub Copilot has used models from OpenAI, Anthropic, and Google. Anthropic’s Claude Code is making headway in AI coding tools. Google and Amazon have posted gains in their AI as well, upping pressure on Microsoft to show it can develop more of its own technology stack.
Washington gave markets another boost. The Department of War said it signed a five-year, $9.7 billion deal with Dell Federal Systems to buy Microsoft Services, expecting to save $422 million a year. The agreement spans Microsoft 365, advanced cloud subscriptions and on-premises licensing, which means software running on both customer systems and in the cloud.
Kirsten A. Davies, chief information officer for the department, called the agreement a “definitive step forward.” She said the move will bring Microsoft software and services under one deal for the military, intelligence community, and U.S. Coast Guard. Breaking Defense reported the blanket purchase agreement is not new money but combines current IT budgets under one contract. Breaking Defense
Microsoft’s shares rose 3.4% on May 28, boosting the company’s market value by about $107 billion, The Motley Fool said. That move had the biggest effect on both the S&P 500 and Nasdaq Composite due to Microsoft’s heavy index weight. The story also mentioned the Dell-Pentagon deal as a positive for Microsoft’s recurring software revenue.
Snowflake’s latest numbers have pushed software sentiment higher. StockStory said Microsoft got a boost after Snowflake’s first-quarter topped expectations, easing worries about AI’s impact on subscription software. Snowflake posted product revenue of $1.33 billion, a 34% jump. CEO Sridhar Ramaswamy called AI a “clear inflection point” for Snowflake. Barchart.com
Snowflake said it will spend $6 billion on AI and Graviton compute through Amazon Web Services in the next five years, as demand for data and AI workloads rises. The company called out accelerating demand. The move gave investors another glimpse at cloud competition, offering a read on Microsoft’s Azure too, even though Snowflake’s bigger deal is with Amazon.
Microsoft posted stronger numbers for the quarter ended March 31, with revenue up 18% to $82.9 billion. Microsoft Cloud revenue jumped 29% to $54.5 billion, while Azure and other cloud services rose 40%. CEO Satya Nadella said Microsoft’s AI business cleared a $37 billion annual run rate, which takes the current sales and annualizes them.
Microsoft traded at 21.5 times forward earnings, below its 10-year average, according to Scott Kaufman, a Seeking Alpha contributor known as Treading Softly. In a note out Friday, he set fair value at $534. Kaufman also pointed to risks from large OpenAI exposure and uncertainty around how much businesses will spend on Copilot, saying the rally still depends on adoption.
But the downside is still there. Microsoft reported $31.9 billion in capital spending for the March quarter, with about two-thirds of that going to short-lived assets like GPUs and CPUs. The company said gross margin was hit by investments in AI infrastructure and use of AI products. If the new models disappoint or customers push back Copilot rollouts, the returns from that spend could take longer than what investors hope.
Investors are sticking with companies that deliver real AI demand instead of sweeping forecasts. Microsoft’s next big check comes at Build, where the company needs new models and defense-driven software buying to keep pushing paid Copilot signups, more Azure usage, and better margins.
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