Microsoft’s Fairwater AI data centers in Wisconsin boosted Azure growth and helped lift MSFT stock. They started going live last year and are set to reach 500 megawatts by mid-2026 to support AI workloads.
UBS analyst Karl Keirstead said checks with industry partners found no major delays in the Fairwater rollout. This reassurance supports expectations for steady Azure capacity expansion.
OpenAI expects $115 billion in losses through 2029, and much of that spending will flow into data centers. (Ed. note: that scale of investment helps explain why cloud infrastructure names benefit.)
Morgan Stanley initiated a bullish stance, labeling Microsoft “overweight” and keeping a $650 price target. Analysts said that target implies roughly 38% upside and called the early-year dip a potential buying opportunity.
UBS trimmed its Microsoft price target to $600 from $650 while keeping a Buy rating, citing Azure as the main growth driver. Dan Ives of Wedbush called Microsoft a “core winner” for 2026, expecting Azure to move from pilots to broad enterprise deployments.
Evercore ISI analyst Julian Emanuel added a cautionary note but said systemic risks tied to the AI trade remain limited. He pointed to healthy hyperscaler balance sheets and muted cross-holdings as stabilizing factors.
