Microsoft is one of the largest and most successful companies in the world; as such, it needs little in the way of introduction. At the end of October, the technology giant released its first quarter results for fiscal year 2025 which beat market expectations.
Keep reading to learn more about Microsoft’s fiscal first quarter performance, how the market reacted and what analysts are forecasting for the stock over the coming year.
| Stock: | Microsoft Corp. |
| Symbol for Invest.MT5 Account: | MSFT |
| Date of Idea: | 12 November 2024 |
| Time Line: | 6 – 12 months |
| Entry Level: | $440.00 |
| Target Level: | $495.00 |
| Position Size for Invest.MT5 Account: | Max 5% |
| Risk: | High |
- The Invest.MT5 account allows you to buy real stocks and shares from some of the largest stock exchanges in the world.
All trading is high risk, and you can lose more than you risk on a trade. Never invest more than you can afford to lose. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.
Microsoft Fiscal Q1 2025 Performance
Here are some of the key highlights from Microsoft’s fiscal first quarter earnings report:
- Revenue of $65.59 billion vs $64.55 billion expected.
- Earnings per share of $3.30 vs $3.10 expected.
- Operating income of $30.6 billion, an increase of 14% year on year.
- Microsoft Cloud revenue rose 22% to $38.9 billion.
Microsoft’s results beat expectations on the top and bottom lines, with its cloud division driving growth. In particular, Microsoft’s Azure cloud platform remained one of the fastest growing parts of the business.
Azure – whose 20% share of the cloud market is second only to Amazon Web Services – saw revenue jump 33% during the quarter, with its suite of AI services reportedly contributing 12 points of this growth.
The global cloud market is growing rapidly, largely thanks to an AI-fueled increase in demand, causing cloud revenues to soar. As one of the dominant players in the cloud and AI industries, Microsoft finds itself well-positioned to benefit from this trend.
However, despite results beating expectations, the market was underwhelmed by Microsoft’s softer than expected guidance for the current quarter, with share price falling 6% in the following day’s session. Microsoft’s finance chief, Amy Hood, noted on the earnings call that they expect slower Azure growth of between 31% and 32% (at constant currency) during the current quarter.
There were also concerns surrounding current AI capacity. Hood noted that “demand continues to be higher than our available capacity”. This constraint in supply could limit growth, although CEO Satya Nadella stated that he felt “pretty good” about reducing the supply-demand imbalance in the second half of the fiscal year.
Indeed, Microsoft is investing a lot to increase its capacity. During the fiscal first quarter, the tech giant reported capital expenditures of $20 billion, almost twice as much as the same quarter in the previous year, with much of this money allocated to its cloud and AI offerings.
Microsoft Stock Forecast – What do the Analysts Say?
According to 29 analysts polled by TipRanks for Microsoft stock forecast in the past 3 months, there are currently 26 buy, 3 hold and 0 sell ratings on the stock. The highest price target amongst these analysts is currently $550.00, whilst the lowest is $425.00.
The average price target for a Microsoft stock forecast is $495.33.
An Example Trading Idea for the Microsoft Stock Price
An example trading idea for the Microsoft share price could be as follows:
- Buy the stock on a break above $440.00 to allow for volatility.
- Target just below the highest analyst price target at $495.00.
- Keep your risk small at a maximum of 5% of your total account.
- Time Line = 6 – 12 months
- If you buy 10 Microsoft shares:
- If target is reached = $550.00 potential profit [($495.00 – $440.00) * 10 shares].
Remember that markets go up and down. It is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, if it rises at all. Be sure to exercise good risk management and always know how much you could potentially lose on a trade and all the risks involved, as well as the costs.
With the Admirals Invest.MT5 account you can buy and sell US stocks with commissions from $0.02 per share and a minimum transaction fee of $1. This means that buying 10 Microsoft shares would result in a commission of just $1 overall.
How to Buy Microsoft Stock in 4 Steps
With Admirals, you can buy shares in Microsoft and more than 4,500 other companies from around the world. Follow these steps to get started:
- Open an account with Admirals and log in to the dashboard.
- Click Trade or Invest next to one of your live or demo accounts to open the web platform.
- Search for Microsoft stock in the search window at the top.
- Create a new order and input your entry, stop-loss and take profit levels.
Click on the banner below to trade Microsoft stock today ▼▼▼
Do You See the Microsoft Stock Price Moving Differently?
Remember that all analytics and trading ideas are based on the personal view and experience of the author.
If you believe there is a higher chance Microsoft share price will move lower, then you can also trade short using CFDs (Contracts for Difference), which Admirals also provides access to through its Trade.MT5 and Trade.MT4 accounts.
This means, using CFDs, you can trade long and short to speculate on both rising and falling stock prices.
INFORMATION ABOUT ANALYTICAL MATERIALS:
The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admirals investment firms operating under the Admirals trademark (hereinafter “Admirals”) Before making any investment decisions please pay close attention to the following:
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- The Analysis is prepared by an independent analyst Roberto Rivero, Freelance Contributor (hereinafter “Author”) based on personal estimations.
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