RBC Capital Maintains Microsoft at Outperform, $640.00 Price Target

RBC Capital maintained its Outperform rating and $640.00 price target on Microsoft after hosting investor meetings with the company’s IR team.

Our view: We maintain our Outperform rating and price target of $640 on Microsoft after hosting investor meetings with Josh Elvidge, Sr. Director, IR and Elana Botha, Director, IR.

Key topics of discussion include: 1) M365 Usage/AI demand signals; 2) Capex allocations; 3) OpenAI; 4) Pricing evolution; 5) infrastructure fungibility; 6) capital allocation; 7) cost efficiencies; 8) E7; 9) Multimodality; and 10) multi-cloud trends.

Overall, we continue to feel positive on Microsoft’s growth opportunity and ability to maintain and expand its AI leadership position.

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