Microsoft Azure Pricing Shifts Gradually, Not a Sudden Boost

Microsoft's (NASDAQ:MSFT) Azure pricing has become one of the biggest topics in recent investor discussions, according to Stefan Slowinski, an analyst at BNP Paribas. Slowinski reiterated a positive view on Microsoft with a $549 price target, implying about 11% upside from the stock’s Sept. 18 closing price of $493.80.

BNP Paribas spoke with Microsoft Investor Relations ahead of the company's fiscal first-quarter 2027 quiet period, and Microsoft acknowledged that Azure pricing is moving higher. However, the company does not plan to alter existing contract economics, instead new pricing would take effect as contracts renew.

This means pricing benefits are likely to flow into Azure revenue gradually rather than trigger an immediate jump in growth, Slowinski said. Importantly, Microsoft indicated that recent Azure strength has not been driven by pricing, but rather fleet efficiency improvements and additional capacity remain the main growth drivers.