Microsoft Stock Forecast 2024, 2025 & Beyond: Will the ‘Champagne Moment’ Continue?

Microsoft (MSFT) remains a firm investor favorite among the best tech stocks, having set fresh record highs in a bumper start to 2024, thanks in part to the software giant’s affiliation with OpenAI.

With a $2.99 trillion market capitalization, Microsoft is the largest company in the world. The MSFT stock price is up 7.59% year-to-date as of April 30, 2024.

Microsoft (MSFT) Year-to-Date Price Performance.
Microsoft (MSFT) Year-to-Date Price Performance. Source: TradingView

Microsoft (MSFT) Year-to-Date Price Performance. Source: TradingView

Will the MSFT stock rally continue on the back of AI developments, or will the retracement from all-time highs extend into a more protracted downturn?

We look at the major price drivers behind the bullish MSFT price action and consider analysts’ latest Microsoft stock predictions for 2024, 2025, and beyond.

Key Takeaways

  • Microsoft’s association with OpenAI and the release of the AI-enhanced Microsoft 365 Copilot contributed significantly to its stock’s robust performance in early 2024, highlighting the market’s optimistic view on its AI initiatives.
  • Microsoft’s fiscal Q3 2024 earnings increased to $61.9 billion, bolstered by the Activision Blizzard acquisition and a 23% increase in revenues from its Cloud division.
  • Analyst forecasts show general optimism, with Microsoft stock predictions for continued growth driven by its leadership in AI technology.
  • Concerns that Microsoft’s stock may be overvalued alongside other megacap stocks tied to optimism surrounding AI weighted on the MSFT stock price in Q2 2024.

Summary of the Latest Microsoft (MSFT) Stock Predictions

Microsoft Stock Forecast

(as of April 30, 2024)

1-Year Forecast 2025 (December) 5-Year Forecast to April 2029
MarketBeat $452.61
WalletInvestor $544.75 $637.63 $1,090.86
TipRanks $477.41
GovCapital $722.89 $829.62 $2,811.52
Fintel $471.52

Microsoft Stock Analysis: Stellar MSFT 1-Year Performance

Over the past year, the Microsoft (MSFT) stock price has gained an impressive +32.31 as of April 30, 2024. For the last five years, the picture looks even brighter with MSFT securing +209.88% gains.

The shares nearly doubled in a massive bull run since bottoming in October 2023, moving from around $220 per share to $430. They have since pulled back in what for now looks like a natural correction from a long winning streak.

The latest bull run for the firm Bill Gates founded nearly 50 years ago in 1975 followed a steep decline in the 2022 bear market that was particularly bruising for tech stocks.

Long-term investors who held on through 2022 or joined the latest up leg in 2023 will have welcomed the consistently strong performance, outpacing its ‘Magnificent Seven’ megacap tech stock rivals Alphabet (GOOGL), Apple (AAPL) and Tesla (TSLA) and only outdone by Nvidia (NVDA) and Meta Platforms (META).

Microsoft (MSFT) 1-Year Price Performance. Source: TradingView
Microsoft (MSFT) 1-Year Price Performance. Source: TradingView

The Latest Microsoft News and Key Stock Price Drivers

Some of the most important MSFT news centers around quarterly earnings, its plans for AI and its successful navigation of government policy and regulation.

Latest MSFT Earnings Well-Received

Microsoft recently announced its fiscal Q3 2024 earnings, recording a significant revenue increase to $61.9 billion, up 17% year-over-year, and a net income boost of 20% to $21.9 billion.

This growth was largely fueled by the acquisition of Activision Blizzard, which temporarily made gaming the company’s third-largest segment and bolstered its gaming revenues, despite a 31% decrease in Xbox hardware sales.

Meanwhile, Microsoft Cloud thrived with a 23% revenue increase, driven by Azure and AI services.

Additionally, Windows OEM revenue unexpectedly rose by 11%, attributed to licensing fees from PC manufacturers, with future prospects tied to the launch of AI PCs featuring Qualcomm’s Snapdragon chips.

Despite the downturn in Xbox hardware, Microsoft remains optimistic about future gains from Xbox content and services, influenced by Activision Blizzard.

The Copilot AI Chatbot

A big Microsoft news announcement in November 2023 was the launch of Microsoft 365 Copilot, its AI assistant designed for Office applications like Word and Excel, making it available for corporate purchase.

To date, it has reportedly mostly been used to summarize meetings and emails, and while the feedback has mostly been positive on the product, according to Business Insider, some clients have drawn unfavorable comparisons with ChatGPT.

Notably, Mustafa Suleyman, a co-founder of DeepMind and Inflection, joined Microsoft to lead its AI efforts, particularly focusing on Copilot and other consumer AI products, demonstrating Microsoft’s dedication to AI innovation and partnership with OpenAI​.

Satya Nadella, chairman and chief executive officer of Microsoft, said, commenting on the latest earnings results:

“Microsoft Copilot and Copilot stack are orchestrating a new era of AI transformation, driving better business outcomes across every role and industry.”

Splitting Teams from Office

Microsoft has announced the global separation of its Teams business messaging and video application from the Office suite.

This decision to split the two services worldwide follows a similar action taken in Europe the previous year amid concerns about potential penalties from antitrust regulators.

Initially integrated into Office in 2017, Teams has come under scrutiny by the European Commission following a 2020 complaint from competitor Slack.

Investing in AI and Japan

Microsoft has declared its plan to invest $2.9 billion over the coming two years to enhance its hyper-scale cloud computing and artificial intelligence capabilities in Japan. It’s the largest ever investment the company has made in the country.

Additionally, the company aims to deliver AI education to over 3 million people in Japan within the next three years. Microsoft also intends to establish its inaugural Microsoft Research Asia laboratory in Japan and intensify its cybersecurity partnership with the Japanese government. Similar AI education schemes are planned in the UK, India and elsewhere.

Commenting on the latest Microsoft achievements, Dan Ives, analyst at Wedbush Securities, said it’s a “champagne moment” for the company.

Microsoft Stock Forecast: Analyst Views

Dan Romanoff, a senior equity research analyst at Morningstar, raised his Microsoft stock forecast on April 26. He said in an analyst note:

“Microsoft is one of two public cloud providers that can deliver a wide variety of PaaS/IaaS solutions at scale. Based on its investment in OpenAI, the company has also emerged as a leader in artificial intelligence.”

Romanoff called the latest Microsoft results “Impressive from most angles.” The analyst said:

“Given stronger near-term growth and profitability, we are raising our fair value estimate to $435 per share, from $420 previously. Results are impressive from most angles, but we highlight strength in AI, Azure, and gaming.”

Goldman Sachs analyst Kash Rangan kept his price target at $450 post-earnings having previously been enthusiastic on future AI integration, noting:

“Microsoft is in a unique position to scale Gen-AI revenue without structural changes to its profitability profile.”​

Wells Fargo’s Michael Turrin adjusted up his MSFT price target from $480 to $500 after

Microsoft released its fiscal third-quarter results. The analyst believes the tech giant is “the outright leader in cloud/IaaS.”

Jefferies analyst Brent Thill who maintained his Buy rating and kept his Microsoft stock forecast in 2024 at $550, believes the company will be “the top AI winner” and the key beneficiary of generative AI.

Thill said in a client note:

“We believe that MSFT is the key beneficiary of Gen AI, poised to benefit from both infrastructure (Azure OpenAI) and app angles (series of Copilots) opportunities, capturing the most of this transformational opportunity. ”

Wedbush’s Dan Ives, who recently raised his MSFT stock forecast from $475 to $500, is all-in on AI as an investable theme for the coming years, comparing it to the release and mass adoption of Windows 95. He wrote:

“We continue to believe this is a ‘1995 Moment’ as this AI Revolution plays out across the tech ecosystem over the coming years with Nvidia/Jensen and Microsoft leading the way as this $1 trillion AI tidal wave hits the shores of the tech world.”

Latest Microsoft Stock Forecasts for 2024, 2025 and 2030

There is currently a rating of ‘Moderate Buy’ on Microsoft stock as of April 30, 2024, according to the views of 34 Wall Street analysts compiled by MarketBeat. There are 32 ‘Buy’ and two ‘Hold’ ratings, with no analysts giving ‘Sell’ recommendations.

The average one-year Microsoft (MSFT) stock forecast for 2024/2025 is for the price to reach $452.61, with the highest projection being $600.00 and the lowest estimate standing at $232.00.

The following table shows 10 latest analysts’ Microsoft stock predictions.

Date Brokerage Action Rating Price Target Percentage Change
4/26/2024 Wells Fargo & Company Boost Target Overweight ➝ Overweight $480.00 ➝ $500.00 22.32%
4/26/2024 Wedbush Reiterated Rating Outperform ➝ Outperform $500.00 25.30%
4/26/2024 The Goldman Sachs Group Boost Target Buy ➝ Buy $450.00 ➝ $515.00 29.06%
4/26/2024 Sanford C. Bernstein Boost Target Outperform ➝ Outperform $465.00 ➝ $489.00 22.54%
4/26/2024 Raymond James Reiterated Rating Outperform ➝ Outperform $450.00 ➝ $480.00 17.41%
4/26/2024 Piper Sandler Reiterated Rating Overweight ➝ Overweight $455.00 ➝ $465.00 16.53%
4/26/2024 JPMorgan Chase & Co. Boost Target Overweight ➝ Overweight $440.00 ➝ $470.00 17.78%
4/26/2024 Evercore ISI Boost Target Outperform ➝ Outperform $475.00 ➝ $485.00 21.54%
4/10/2024 Wedbush Reiterated Rating Outperform ➝ Outperform $500.00 +18.90%
4/10/2024 UBS Group Reiterated Rating Buy ➝ Buy $480.00 +14.23%

Source: MarketBeat as of April 30, 2024

Looking further out to next year, Fintel.io has compiled various analyst estimates to project an MSFT stock price of $471.52.

A consensus MSFT price target from analyst views compiled by TipRanks suggests that Microsoft could reach $477.41 in the next 12 months and has a ‘Strong Buy’ rating.

Meanwhile, the Microsoft stock forecast 2025 of algorithm-based WalletInvestor is much more bullish, putting the stock at $544.75 in 12 months’ time. 

However, its five-year MSFT stock forecast expects it to move even higher and reach $1,090.86 by May 2029.

Meanwhile, another algorithm-based prediction platform, GovCapital, expressed the most bullish 5-year Microsoft stock forecast, setting the MSFT target price at $2,811.52 for April 30, 2029.

Analysts and algorithm-based prediction platforms refrain from giving longer-term price targets. Therefore, Microsoft’s stock forecast for 2030 is not readily available.

Note that analysts’ and algorithm-based projections might prove to be wrong.

The Bottom Line: Should I Invest in Microsoft?

Microsoft’s stock has seen substantial gains so far in 2024, driven by its collaboration with OpenAI and the launch of the AI-powered Microsoft 365 Copilot.

Well-received quarterly earnings helped the shares stymie a stock price correction at the start of the second quarter but there are some indications the stock might be overvalued, reflecting the market’s perhaps unrealistically high expectations and enthusiasm for the company’s future.

It’s important to do your research, consider the market context, and consult with a financial advisor to make an informed decision that aligns with your investment objectives.

Do your own research and always remember your investment decision depends on your attitude to risk, your expertise in the stock market, the spread of your portfolio, and how comfortable you feel about losing money.

The information in this article does not constitute investment advice and is meant for informational purposes only.

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Jasper Lawler
Financial expert
Jasper Lawler
Financial expert

Jasper cut his teeth on Wall Street as a stockbroker and honed his analytical skills with the City of London's top trading firms. Today, he applies his financial expertise to content creation as the founder of Trading Writers, a niche content marketing agency for the finance sector. Jasper's articles can be found on Techopedia, Seeking Alpha, UK Investor Magazine, Trade2win, Investing.com, FXStreet, Trading212.com, FlowBank.com, and Capital.com. His analysis has been quoted in prestigious publications such as the Financial Times, Bloomberg, Reuters, AFP, and City AM. Jasper's transition from stockbroker to content creator highlights his deep understanding of the financial markets…