Microsoft added nearly $450 billion in market value on Thursday, the largest one-day gain on record for any company, after it forecast stronger-than-expected cloud growth and signaled continued cash generation.
The software giant's shares closed up more than 15%, lifting its market capitalization to $3.35 trillion and surpassing the previous record of $441 billion set by Nvidia on April 9, 2025, according to LSEG data.
The jump came after Microsoft guided for Azure growth of 45% in constant currency for its fiscal first quarter — well above the 40.92% analysts had expected, per Visible Alpha — and said it expects capital expenditures of $50 billion for the first quarter of fiscal 2027 and $175 billion for calendar 2026.
The results offered fresh evidence that Microsoft's massive AI investments are beginning to pay off, easing investor concerns that heavy spending on data centers could outpace demand. 'Microsoft reported a very strong quarter and it struck the tone markets are looking to hear as the key drivers of growth came from the cloud and AI divisions,' said Brian Mulberry, chief market strategist at Zacks Investment Management.
At least nine brokerages raised their price targets on the stock, lifting the mean target to $560.90. The move comes after Microsoft lagged several of its 'Magnificent Seven' peers this year, with the stock down more than 18% up to Wednesday's close. 'The key question was whether it could shift the conversation from how much it is spending on AI to what it is earning from those investments, and the results suggested meaningful progress,' said Jake Behan, head of capital markets at Direxion.
