NEW YORK, Jan 24, 2026, 09:33 EST — Market closed
- Shares of Microsoft rose 3.3% on Friday, finishing at $465.95 and laying down a stronger tone for the week ahead.
- UBS lowered its price target to $600 but maintained a Buy rating, highlighting the AI data-center expansion as a key driver for Azure.
- As Jan. 28 earnings approach, investors are zeroed in on Azure’s growth, AI-driven spending, and potential impacts from the recent Microsoft 365 outage.
Microsoft shares surged 3.3% on Friday, closing at $465.95 after fluctuating between $449.05 and $471.07. The stock finished near the day’s high as it heads into a week that may shift investor expectations.
Saturday sees U.S. markets closed, yet Microsoft (MSFT) stands out as a key focus. The tech giant plans to release its fiscal second-quarter earnings after the bell on Jan. 28, followed by a live webcast at 2:30 p.m. Pacific time.
Timing is crucial here as the narrative around Microsoft grows more focused: investors demand growth and clear evidence of it. While analysts are scaling back “price targets” — their forecasts for the stock’s potential over the coming year — they remain mostly bullish. The upcoming guidance update is expected to carry the weight of expectations.
UBS lowered its price target for Microsoft, dropping it from $650 to $600, while maintaining a Buy rating. The firm highlighted the rollout of Microsoft’s Fairwater AI data centers as a key near-term boost for Azure, the company’s cloud division, noting that the Wisconsin facility is expected to go live in the first quarter.
Cantor Fitzgerald cut its price target to $590 from $639 but stuck with an Overweight rating, Barron’s reported. Analyst Thomas Blakey noted, “Our checks came in positively for AI/Azure demand and Copilot adoption.” Meanwhile, UBS’s Karl Keirstead pointed to an “evident de-rating” in software valuations. Microsoft expects 37% Azure revenue growth this quarter, down from 40% previously. Morgan Stanley maintained its Overweight rating with a $650 target. Barron’s
This week also highlighted the double-edged sword of Microsoft’s massive scale. A Microsoft 365 outage disrupted services like Outlook, Microsoft Defender, and Microsoft Purview. By Friday, Microsoft confirmed access was restored, with Downdetector reporting incidents dropping to 113 at 1:05 a.m. ET, down sharply from over 15,890 at the previous day’s peak, according to a Reuters report.
The broader market picture is tougher than it seems, with a packed earnings schedule and a Federal Reserve policy decision due Wednesday. “Earnings are the driver,” said Franklin Templeton strategist Chris Galipeau to Reuters, as investors await clearer signs of AI investments boosting revenue. Reuters
Microsoft remains under scrutiny over Azure, with investors focused on how much of its AI expansion is turning into real booked business and steady revenue streams. Capital spending, or CapEx—funds poured into data centers and other durable equipment—will also be closely watched for signs it might be leveling off rather than ramping up.
That setup works both ways. If Azure growth misses the 37% target or management pushes spending without a clearer timeline for returns, Friday’s rally could unravel fast—especially as software valuations are already shaky.
Monday’s open will test if buyers stick around. The real pressure comes later this week: the Fed’s verdict on Wednesday, followed by Microsoft’s earnings report after the market closes that day.
