Azure Growth Spikes as Microsoft's AI Bet Pays Off

Microsoft's AI-driven growth strategy is gaining momentum after the company's latest results showed accelerating Azure growth. The firm's fourth-quarter (4Q26) results revealed that Azure growth accelerated from 39% in the third quarter (3Q26) to 43% in 4Q26, with guidance of 45% in the first quarter (1Q27).

Bank of America analysts are bullish on Microsoft, reiterating a Buy rating and raising their price target to $600 per share from $500. The analysts cited Microsoft's AI strategy as a key driver of Azure growth.

Nvidia Corp is also investing heavily in AI infrastructure, extending payment terms for some customers to 60 days and partnering with major financial firms to raise over $500 billion in third-party infrastructure capital. This move aims to remove financial bottlenecks in AI deployment.