Microsoft stock eases 0.1% from record high after huge volume AI-driven rally
Microsoft hits new all-time high at $506.8 amid AI-driven rally
Microsoft stock has continued its impressive upward march this week, extending gains both on a weekly and monthly basis.
After spending the past four days consolidating between $500 resistance and $490 support, a strong breakout arrived on Wednesday. The midweek move saw Microsoft surge over 2% to a new all-time high at $506.8, breaking above last week’s record high at $500 per share.
Highlights
-Microsoft hits a new all-time high at $506.8 on strong volume before easing to $502.5
-AI cost savings and rising Azure revenue support Microsoft’s long-term growth
-$500 level acts as key support as short-term cooling phase unfolds
This breakout came on stronger volume than the prior four days, highlighting renewed buying interest. However, the rally faced immediate pressure from overbought conditions shown by the RSI momentum indicator. As a result, Microsoft closed slightly lower at $503.5 on Wednesday despite the intraday high.
Microsoft stock price dynamics (May - July 2025)
In Thursday’s premarket session, Microsoft shares continued to ease, trading near $502.5. This represents a mild 0.1% decline from the previous close, suggesting some traders are locking in profits after the strong move. Despite this slight pullback, Microsoft still shows a week-to-date and month-to-date gain of about 0.8%, keeping the broader uptrend intact.
Microsoft AI cost savings and Azure growth reinforce long-term strength
Fundamentally, Microsoft’s story is increasingly shaped by its AI initiatives. According to the company’s COO, AI saved Microsoft $500 million last year in call centre operations alone. This efficiency gain underlines how AI investments are already delivering tangible cost savings. Moreover, revenue from AI services, driven by Azure, has been rising steadily, yet some analysts believe the market still undervalues this growth potential.
As Azure’s strong growth continues into the first half of the year, expectations for AI-related services, such as Copilot Studio, suggest further upside if momentum carries into fiscal 2026. Investors are now looking ahead to upcoming quarterly results for clues on the pace of AI revenue expansion and whether it can serve as a new pillar for Microsoft’s valuation, similar to how AWS supports Amazon.
Technically, the break above the $500 psychological level is significant and may act as near-term support if the current cooling phase extends. This level could provide a solid base for a new leg higher once selling pressure from overbought signals subsides. Hence, the strong long-term narrative around AI, supported by robust financial performance, points to further potential gains as the year progresses.
Microsoft stock gained after restructuring plans and strong cloud growth boosted confidence. Price bounced from $488.8 to retest $500, showing strong recovery momentum.
