Weekly forecast: Microsoft shares hit record $518 ahead of earnings report

Traders Union
All News
Financial News
Weekly-forecast-microsoft-shares

All news

Top Stories

Editors' Picks

Crypto News

Financial News

Market Voices

Billionaires

Companies

Broker News

Regulators News

Emilio Ghigini

26.07.2025

Weekly forecast: Microsoft shares hit record $518 ahead of earnings report — Wall Street expects strong earnings from Microsoft

On July 30, Microsoft will release its quarterly earnings report, but even preliminary data revealed this week pushed MSFT shares to a new all-time high, surpassing $518 on Friday.

Microsoft stock has climbed approximately 31% over the past three months, reflecting the company’s strong fundamentals, largely driven by surging demand for AI and cloud services.

MSFT stock daily chart. Source: Trading View

According to Yahoo Finance, MSFT’s momentum is expected to continue. Strategic investments in AI — including its partnership with OpenAI and AI integration across Microsoft products — are likely to fuel further revenue growth. Enterprise clients are still heavily investing in digital transformation, and Microsoft is well-positioned to capitalize on this trend.

A key signal of Microsoft’s strength is the growth in its Remaining Performance Obligations (RPO) — a forward-looking revenue metric — which rose 34% YoY to $315 billion last quarter. Management expects around 40% of that total to be recognized as revenue over the next 12 months, offering strong visibility into future earnings.

Cloud remains the main growth catalyst. Despite capacity constraints, the Azure segment is forecast to deliver another strong quarter.Guidance for Intelligent Cloud revenue ranges from $28.75B to $29.05B, supported by rising enterprise cloud adoption and growing usage of AI services.

The More Personal Computing segment is expected to generate $12.35B–$12.85B in revenue, with search and news advertising growing 10–12%, driven by a larger user base and higher monetization per search.

Microsoft’s gaming division is also forecast to grow, with mid-single-digit growth overall and Xbox content and services revenue expected to expand by around 10%.

AI infrastructure vs profitability

While Microsoft’s AI infrastructure buildout may put short-term pressure on margins, the company’s focus on operational efficiency is expected to ease profitability concerns.

Wall Street remains bullish. Analysts expect $3.35 EPS, up 13.6% from $2.95 last year.

Even after a strong rally, analysts maintain buy ratings on MSFT. The average price target is $552.35, implying an 8% upside. The highest target is $626, suggesting 23% upside from current levels.

Overall, moderate growth in MSFT stock may continue next week, supported by the earnings release. While macro or geopolitical shocks could interrupt momentum, MSFT remains technically strong, with key support at $509 (SMA 20/50) and the psychological level of $500, which triggered the latest breakout on July 23.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.