tech
February 13, 2026
Microsoft is down this year on fears AI will disrupt Office. Goldman says buy the dip
Goldman Sachs' $600 price target implies that shares of Microsoft could rally 49%.
TL;DR
- Goldman Sachs views the recent pullback in Microsoft shares as a buying opportunity.
- Fears of AI disruption and slower Azure growth are considered overstated by the bank.
- Goldman Sachs maintains a 'buy' rating and a 12-month price target of $600 for Microsoft.
- The bank's forecast suggests a potential upside of over 49% for Microsoft shares.
- Microsoft shares have declined 17% year-to-date due to broader tech stock pullbacks and AI disruption fears.
- A 10% drop followed recent earnings due to 39% revenue growth in Azure, which was slightly below consensus.
- Analyst Gabriela Borges attributes the lack of upward Azure revisions to Microsoft prioritizing internal compute capacity for Copilot and R&D, rather than external revenue-generating workloads.
- This strategic allocation of resources means some compute investments are not yet directly monetized in reported Azure revenue, causing near-term monetization concerns.
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