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Stifel Downgrades Microsoft Amid Azure Slowdown and AI Spending Concerns
Stifel Downgrades Microsoft Amid Azure Slowdown and AI Spending Concerns
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Microsoft shares face renewed pressure as Stifel downgrades the stock, citing slowing Azure growth and unchecked AI expenditures. The firm slashed its price target to $392—the lowest among major analysts—following a 14% post-earnings plunge last week.
Azure's deceleration contrasts sharply with Google Cloud's recent strength, while Anthropic gains momentum in the AI race. "We see no near-term catalysts," said analyst Brad Reback, noting Microsoft's capital expenditures now outpace Azure's performance.
The cloud division's supply constraints and intensifying competition create headwinds for what was once Microsoft's growth engine. Meanwhile, massive AI investments show no immediate return, further squeezing margins.
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