Microsoft: AI Can’t Make The Macro Headwinds Go Away


  • We remain bearish on Microsoft’s post-earnings results.
  • We downgraded the stock to a sell earlier this year, driven by our belief that the company will be pressured by weaker IT spending in 1H23.
  • Amid the AI boom, we recommend investors be wary where others are greedy. We don’t expect Microsoft’s partnership with OpenAI to materialize meaningfully in 1H23.
  • We also believe the stock is relatively expensive, trading at 7.5x EV/C2024 sales versus the peer group average of 4.5x.
  • We expect the company still has more downside ahead before the stock can recover meaningfully. We recommend investors stay on the sidelines for the near term.

Microsoft Unveils New Surface Laptop

Drew Angerer

We continue to be sell-rated on Microsoft (NASDAQ:MSFT) post-earnings results. We downgraded Microsoft stock to a sell earlier this year. We continue to believe the company is under pressure in the near term due to macroeconomic headwinds


FY2Q23 Earnings Presentation


FY2Q23 Earnings Presentation





Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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