Updated: December 2, 2025
Microsoft Corp. (NASDAQ: MSFT) heads into December trading just under all‑time highs as investors digest record AI spending, a reshaped OpenAI partnership, and a looming governance showdown with one of its biggest shareholders.
Here’s a comprehensive look at Microsoft’s share price, the latest news, analyst forecasts, and key risks shaping MSFT stock today, December 2, 2025.
Microsoft stock today: price, valuation and performance
As of the close on Monday, December 1, 2025, Microsoft stock finished at $486.74 per share, with a market capitalization of roughly $3.6 trillion. [1]
According to recent data from MarketBeat and StockInvest: [2]
- 52‑week range: about $344.79 – $555.45
- Trailing P/E ratio: ~34.6x earnings
- PEG ratio: ~2.36
- Beta: ~1.0 (moves broadly in line with the wider market)
- Balance sheet: low debt‑to‑equity (~0.12) and solid liquidity (current ratio ~1.35).
Year to date, Microsoft shares are up about 16% in 2025, driven largely by optimism around its AI and cloud leadership. [3]
From a technical standpoint, StockInvest’s AI‑driven model currently labels MSFT a “sell candidate” in the short term, noting that the stock has: [4]
- Declined in 6 of the last 10 trading days,
- Fallen about 4.6% over that period,
- Moved into the middle of a “wide and falling” short‑term trend,
- And is expected (with 90% probability, in their model) to trade between $458–$522 over the next three months.
They also estimate a “fair” opening price for December 2 at $487.08, essentially flat compared with Monday’s close. [5]
So, fundamentally, Microsoft looks strong and expensive; technically, it looks a little tired after a big multi‑year run.
Earnings recap: AI and Azure are booming – and so is spending
Microsoft’s most recent results (fiscal Q1 2026, reported October 29, 2025) set the tone for how investors are thinking about MSFT right now. [6]
From the company’s official earnings release: [7]
- Revenue: $77.7 billion, +18% year over year
- Non‑GAAP EPS: $4.13, +23% year over year
- Operating income: $38.0 billion, +24%
- Microsoft Cloud revenue: $49.1 billion, +26%
- Azure and other cloud services:+40% revenue growth
- Commercial remaining performance obligation (RPO): up 51% to $392 billion
The cloud and AI flywheel is unmistakable: Azure and Microsoft 365 are growing at high‑double‑digit rates, and long‑term customer commitments are surging.
But the price tag for that growth is huge:
- In fiscal Q1, Microsoft’s capital expenditures reached about $34.9 billion, focused heavily on GPUs, CPUs and new data‑center capacity for AI workloads. [8]
- Reuters and AP both note that this AI build‑out represents a massive step‑up in capex and has become the central point of debate around the stock. [9]
Despite that spending, Microsoft still generated $25.7 billion in free cash flow in the quarter and returned $10.7 billion to shareholders via dividends and buybacks. [10]
Investor takeaway:
Fundamentally, the quarter was stellar — but AI capex is so large that it has started to worry some investors, especially at today’s lofty valuation.
“The next chapter” of the Microsoft–OpenAI partnership
A second major driver of MSFT’s story into December is its renegotiated partnership with OpenAI, announced on October 28, 2025. [11]
Key points from Microsoft’s official blog:
- Microsoft now holds an investment in OpenAI Group PBC valued at ~$135 billion, representing roughly 27% on an as‑converted diluted basis (down from about 32.5% previously). [12]
- Microsoft remains OpenAI’s “frontier model partner” and retains exclusive IP rights and Azure API exclusivity until the point OpenAI declares AGI (artificial general intelligence). [13]
- Microsoft’s IP rights to OpenAI models and products are extended through 2032, including models developed after AGI is achieved, subject to safety guardrails. [14]
- IP rights to certain research concepts expire at AGI or 2030 (whichever comes first), but Microsoft keeps non‑research IP, such as many model weights and inference code. [15]
- OpenAI commits to purchasing an additional $250 billion of Azure services, but Microsoft loses its right of first refusal to be OpenAI’s compute supplier. [16]
- OpenAI is now allowed to jointly develop some products with third parties, and can release open‑weight models that meet capability criteria. [17]
- Microsoft, for its part, is explicitly allowed to pursue AGI independently or with other partners. [18]
Why it matters to the stock
- The upside: Microsoft solidifies a multi‑decade economic relationship with OpenAI, locks in a huge stream of high‑margin Azure demand, and keeps privileged access to OpenAI’s most advanced models through at least 2032. [19]
- The risk: As some analysts have noted, Microsoft’s exclusive rights to OpenAI IP and APIs become less absolute over time. OpenAI can build with other partners and release open‑weight models, which could dilute Microsoft’s moat and make long‑term AI economics harder to predict. [20]
In practice, Wall Street still generally views the deal as a net positive — it stabilizes the partnership after months of governance drama at OpenAI and deepens Microsoft’s role at the center of the AI ecosystem — but the “AI story” is now more capital‑intensive and more complex than the earlier, cleaner narrative.
Governance flashpoint: Norway’s wealth fund vs. Microsoft’s board
The next immediate catalyst for MSFT is Microsoft’s December 5, 2025 annual shareholder meeting, which is shaping up as a test of investor sentiment on AI, governance and human‑rights risk.
Norway’s $2.1 trillion sovereign wealth fund – the world’s largest – has publicly said it will: [21]
- Support a shareholder proposal asking Microsoft to publish a detailed report on how it assesses and mitigates human‑rights risks in countries with significant rights concerns.
- Vote against Satya Nadella serving as both CEO and chair, in line with its longstanding stance against combined roles.
- Vote against Microsoft’s executive pay package, which it argues is excessive.
The fund owns roughly 1.35% of Microsoft, worth about $50 billion, making Microsoft one of its largest holdings. [22]
Microsoft’s board is recommending shareholders vote against the human‑rights proposal and in favor of the current board structure and pay plan. [23]
For the stock, this matters in two ways:
- Reputational and ESG risk – A sizable protest vote could keep human‑rights and AI‑ethics issues in the headlines and influence how large asset managers vote in future years.
- Governance stability – While Nadella’s job as CEO is not at risk, high‑profile opposition from such a major shareholder is rare for a company of Microsoft’s stature.
Most analysts still see limited near‑term financial impact from the vote, but the AGM is clearly part of the broader narrative about how AI giants will be governed and held accountable.
Analyst sentiment: almost universal “Buy,” but debate on valuation
Despite the recent pullback and governance noise, Wall Street’s stance on Microsoft remains overwhelmingly bullish.
Consensus price targets
Different platforms show a clustered 12‑month target range in the low‑to‑mid‑$600s: [24]
- MarketBeat: average target ~$634, based on around 43 analysts; high around $730, low around $490.
- Investing.com: consensus target roughly $625, with a high near $730 and low in the $480s, rating MSFT a “Strong Buy.”
- TipRanks: average target about $630, with a high of $700 and low around $500, also a “Strong Buy.”
- StockAnalysis: similar average around $628, with the majority of analysts rating the stock a “Strong Buy.”
Using Monday’s close at $486.74, the average target implies roughly 30% theoretical upside over the next 12 months, while the more aggressive targets (like $700) imply 40%+. (Targets are estimates, not guarantees.)
Recent rating moves and price‑target changes
Recent analyst activity underscores both the enthusiasm and the debate: [25]
- Wells Fargo raised its target on MSFT to $700 (Overweight) after Q1 results, citing continued Azure strength and AI momentum.
- RBC Capital maintains a $640 Buy rating, calling Microsoft a top software pick with powerful AI and Copilot catalysts.
- Guggenheim Securities upgraded MSFT to Buy with a $586 target on October 27, making it the last of 61 tracked Wall Street firms to move to a Buy‑equivalent rating — Barron’s characterized this as the moment “every firm on Wall Street says buy.” [26]
- On the cautious side, Wall Street Zen recently downgraded Microsoft from Buy to Hold, which MarketBeat reports helped knock the stock about 1.1% lower to around $486.74 on December 1. [27]
Across these notes, a pattern emerges:
- Bulls emphasize Azure’s 40% growth, massive RPO backlog, Copilot monetization and the OpenAI partnership as structural advantages. [28]
- Skeptics worry about the high P/E (mid‑30s), unprecedented AI capex, and the possibility that AI expectations are already fully priced in. [29]
Fundamental bulls vs. technical caution
The fundamental vs. technical split is stark in current commentary.
Fundamental valuation and cash flow
A recent analysis on Barchart argues that Microsoft’s free cash flow supports a valuation around 25–30% above the current share price, suggesting the stock may be undervalued by roughly that amount despite trading near record highs. [30]
Meanwhile, Motley Fool’s breakdown (syndicated via Nasdaq) highlights: [31]
- Double‑digit growth in both revenue (+18%) and EPS (+23%) in Q1 FY26,
- 40% Azure growth and a 23% full‑year cloud growth rate,
- Deep integration of AI (Copilot, AI features across Microsoft 365 and Windows),
- And FCF rising 33% year over year despite the capex surge.
But it also notes that MSFT now trades at about 35x earnings, leaving “little room for missteps” if AI demand or enterprise IT budgets soften.
Technical and short‑term signals
On the technical side, StockInvest’s algorithms currently: [32]
- Flag MSFT as being in a short‑term downtrend,
- Show a negative 3‑month MACD signal,
- And forecast a modest ‑2.7% expected move over the next 3 months, with a 90% probability band between $458.35 and $522.16.
They also see key support around $476.99 and resistance near $517.93, implying the stock sits closer to support than resistance after its recent pullback. [33]
AI bubble or rational exuberance?
Broad market commentary, including from Bloomberg, notes that Big Tech’s old “spend little, earn lots” formula is being challenged by AI’s capital hunger, and specifically cites Microsoft as one of the giants now plowing tens of billions into data centers and chips. [34]
Some strategists see echoes of a potential AI bubble if spending continues to accelerate faster than monetization. Others argue that Microsoft’s combination of cloud scale, software distribution and OpenAI stake puts it in a better position than almost anyone to earn a high return on that investment.
For now, the market’s verdict is mixed: MSFT is off its highs, but still trades at a premium multiple with overwhelmingly positive analyst ratings.
Key themes driving MSFT on December 2, 2025
Bringing the threads together, four big storylines are driving Microsoft’s stock into December:
1. AI infrastructure super‑cycle
- AI‑related capex of roughly $35 billion in a single quarter is unprecedented for a software company. [35]
- Azure’s 40% growth and the 51% surge in commercial RPO show strong demand, but investors are scrutinizing whether returns on this spending will ultimately justify the cost. [36]
What to watch: Azure growth staying near the high‑30s/40% range, progress on Copilot adoption, and management commentary on capex levels for calendar 2026.
2. OpenAI partnership: deeper, but less exclusive
- The updated agreement gives Microsoft decade‑long visibility into OpenAI‑powered products and $250B of incremental Azure demand, but removes some exclusivity and allows OpenAI to work more openly with others. [37]
- Investors are weighing whether this structure maximizes long‑term value or simply locks Microsoft into an expensive arms race.
What to watch: OpenAI’s product roadmap, any new third‑party partnerships, and Microsoft’s own announcements about non‑OpenAI frontier models.
3. Governance, ethics and the Norway wealth fund vote
- Norway’s wealth fund is turning Microsoft’s December 5 AGM into a high‑profile referendum on AI ethics, human‑rights risk and board structure. [38]
- Even if proposals fail, large protest votes could influence future policies and how ESG‑focused funds evaluate MSFT.
What to watch: Vote tallies on the human‑rights report proposal, support levels for Nadella as chair, and any board response in subsequent communications.
4. Near‑term trading vs. long‑term secular story
- Short‑term, MSFT is dealing with an analyst downgrade (Wall Street Zen) and technical selling after a powerful rally. [39]
- Long‑term, nearly all major Wall Street firms continue to see Microsoft as a core AI and cloud compounder with double‑digit growth and huge free cash flows. [40]
Upcoming catalysts for Microsoft stock
From today (December 2, 2025), the next major signposts for MSFT investors include:
- December 5, 2025 – Annual shareholder meeting
- Votes on the human‑rights risk report, election of directors (including Nadella as chair), and executive compensation. [41]
- Dividend and capital‑return track
- Microsoft recently increased its quarterly dividend from $0.83 to $0.91 (annualized $3.64, yield ~0.7%) and continues to execute large buybacks. [42]
- Next earnings release – Q2 FY26
- StockInvest lists Microsoft’s next earnings date as February 4, 2026. The Street will focus heavily on Azure growth guidance, AI capex trajectory, and early Copilot monetization metrics. [43]
- Regulation & AI policy
- Ongoing global discussions on AI safety, competition and data‑center energy usage could shape Microsoft’s operating environment, even if specific rules are still evolving. (This is a broader macro risk rather than a Microsoft‑only story.)
Bottom line: how the narrative around MSFT looks today
On December 2, 2025, the Microsoft story looks like this:
- Business: Firing on all cylinders, with 18%+ revenue growth, 40% Azure growth, and a $392B backlog that suggests strong multi‑year demand. [44]
- Balance sheet & cash: Exceptionally strong, even while funding what may be the largest AI infrastructure build‑out in corporate history. [45]
- Valuation: A premium mid‑30s P/E and consensus targets implying ~20–40% upside, depending on which analysts you believe. [46]
- Risks: AI capex returns, governance and human‑rights scrutiny, potential service outages, and the broader question of whether AI expectations are ahead of reality. [47]
For now, Wall Street’s macro verdict is still overwhelmingly bullish, but short‑term technical indicators are flashing caution, and AI‑related spending plus governance pressure are injecting more volatility into what used to be a fairly “boring” mega‑cap compounder.
Important note
This article is for informational and educational purposes only and does not constitute financial advice, investment recommendation, or an offer to buy or sell any security. Past performance is not indicative of future results. If you are considering any investment decision related to Microsoft (or any other stock), you should carry out your own research or consult a qualified financial advisor.
References
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