[Earnings Preview] Focus on the growth of Microsoft, AI, Azure Cloud, and Copilot!

moomooニュース米国株 wrote a column · Apr 22, 2024 22:00

● $Microsoft (MSFT.US)$Is4/25 (local) after closingFinancial results for Q3 (January-March) are scheduled to be announced on
●Market sales for 24Q3 compared to the same period last year15.14% increase to 60.857 billionDollar and EPS compared to the same period last year$2.83, up 15.41%Expected.
● Analysts say Microsoft's corporate business and AI products are growing continuouslyMaintaining good momentumI'm watching
● Microsoft'sCloud DivisionThe growth of attention is being paid to,Once again a revenue driverPossibility of becoming
●The latest information on AI plansThere is a possibility that it will be announced, and analysts point out that Microsoft is in an advantageous position for AI-led growth
●What is the next growth catalyst for Microsoft stockAccelerating key AI product cyclesWhen it becomes BofA
● The majority of analysts who research Microsoft stocks are bullish, and out of 57 people, 54 people buy and 3 evaluate them as hold

[Earnings Preview] Focus on the growth of Microsoft, AI, Azure Cloud, and Copilot!

Microsoft in the US is scheduled to announce financial results for the 24th Q3 (January-March) after closing locally on 4/25. According to market consensus, in the 24-Q3 (January-March) earnings forecast, sales are year-on-year$60.857 billion, up 15.14%. EPS is the same$2.83, up 15.41%. According to the previous financial results for Q2 '24, sales were 62.02 billion dollars, up 18% from the previous year,Highest sales growth rate in the past 2 yearsachieved,Record sales for 5 consecutive quartersIt was recorded. EPS surpassed market expectations at $2.93, up 33% from the previous year. In addition to the fact that US game giant Activision Blizzard, which was acquired in 2023/10, contributed to earnings, AI (artificial intelligence) supported cloud growth.

The Q3 financial results announced this week are based on Azure cloud computing and the M365 software suiteSignificant increase in salesIt is anticipated. BofA analysts areThe driving force behind Microsoft's growth is the strong performance of Azure and M365I'm here. Also, MicrosoftSustained growth in the first half of the double-digit range over the next 3 to 5 yearsI believe it will be realized.

Focus on cloud revenue growth driven by “Azure”
Investors are Microsoft's intelligent cloud business, particularlyThe growth of “Azure (Azure)”You'll pay attention to it. Azure is Microsoft's previous financial resultsThe main driving forceIt was. Although specific sales figures for Azure have not been disclosed, they have provided a growth rate, and in the most recent quarter, Azure sales were 30% compared to the previous year, which exceeded market expectations that were expected to be around 28%. It grew by 28% on a constant exchange rate basis,It surpassed Amazon's AWS and Google Cloud. Artificial intelligence is the management team's growth rate6 pointsIt was stated that it contributed, and attention is being paid to whether this figure will continue to rise this quarter.

At the marketAzure outlookregardingOverall bullishand, in particularContinued strong performance in the enterprise and AI fieldsThis is expected to have a positive impact on earnings estimates for the latter half of 2024 and 2025. Who are CFRA analystsIntelligent Cloud DivisionWhat is the sales growth rate of19%、AzureThe growth rate29%It is predicted that artificial intelligence will have a growth rate of at leastContribute to 6 to 8% pointsThen I'm watching. EverCoreISI analysts say Azure is based on a constant exchange rate28%It is expected to achieve growth, but higher growth is expected due to increased consumption driven by artificial intelligence (AI),30% growth rate can be achievedBut I'm watching it.

“Copilot” is the focus! Focus on improving corporate productivity and how much it contributes to the company's profits
Investors are Microsoft's AI toolsIncrease in corporate productivity of “Copilot (Copilot)” and its contribution to the company's profitsI'm paying attention to it. Copilot is an AI support function developed in partnership with OpenAI. On November 1 last year, the “Microsoft 365 Copilot” for enterprises was officially offered.What is Microsoft 365 CopilotIt is artificial intelligence that complements major software such as Word and Excel that analyzes user calendars, emails, chats, documents, and meeting data using generative AI. The pace of customer adoption of Microsoft 365 Copilot etc. is unclear, but Microsoft's CFO Amy Hood is Microsoft 365 Copilot'sExpect initial recruitment trendsIt's done,Become a driving force for profit growthI'm expecting it.

Also,The number of GitHub Copilot subscribers has increased drasticallyYes, GitHub's sales for the 2nd quarter were compared to the previous year due to the adoption of GitHub CoPilotOver 40% growthIt has been achieved, and nowOver 1.3 million paying subscribersIt is proud of it,Confirming the rapid spread of Copilot. Analysts say Copilot by 2026Annual sales of approximately $10 billionIt is predicted that it will bring about, and in response to Microsoft's AI strategyStrong market confidenceIt shows. Also, recent Copilot updates include automation of routine tasks, advanced and complex coding functions, etc.Microsoft's commitment to integrating AI across multiple fieldsIt shows. There is a possibility that Microsoft will showcase these new features (and others) at the company's Worldwide Developers Conference (Worldwide Developers Conference) to be held in May, and this depends on the company's product rangePart of a strategy to incorporate advanced AI capabilitiesIt is viewed as.

Investors will therefore keep a close eye on the latest data on Copilot's integration and utilization, and evaluate the impact on Microsoft's business outlook.

What is the next growth catalyst for Microsoft stock?
As a pioneer of the artificial intelligence (AI) boom, there is a possibility that Microsoft will announce the latest information on AI plans.

CFRA analysts pointed out that Microsoft is in an advantageous position for AI-led growth, and in particular, stated that “AI-related businesses can be monetized faster than any other cloud/ software provider” by partnering with OpenAI.

According to BofA analyst Brad Sills,Microso's stock price incorporates AI-driven earnings and FCF acceleration. Regarding the next growth, he said of Microsoft stockThe next growth catalystisMicrosoft 365 Copilot user growthYaCommercial office ASP (average sales price)acceleration of (from 6% to 7%), etc.Accelerating key AI product cyclesI'm watching it become.

Currently, investors $NVIDIA (NVDA.US)$While initial leader companies such as these have entered an adjustment phase and are beginning to feel wary of AI-related stocks, Morgan Stanley updated Microsoft's outlook for the next 10 years last week. Accompanying analysts maintained Microsoft stock ratings “overweighted” and targeted stock pricesRaised from $465 to $520、26% upper marginI suggested that there is.

As for Morgan Stanley, Microsoft by 2029Up to $120 billion in revenue from generative AIHe pointed out that there is a possibility that it will be created Furthermore, Microsoft's EPS will be at the expected level of 2024 ($11.7) by 2029Twice as much as $24I expect it to become.

What was the stock price performance for past financial results days?

According to Market Chameleon, looking back at the stock price gain/fall rate of the past 12 quarterly financial results, the average stock price gain/fall rate on the day Microsoft financial results were announced±3.9%, maximum rate of decline-7.7%, maximum rate of increase+7.2It's%.

Currently, what is the fluctuation range of Microsoft's implied± 4.8%And what is the gain/fall rate of the options market for 1 day after financial results are announced4.8%It suggests that they are betting on it. In contrast to this, Microsoft's average stock price gain/fall rate after announcing financial results for the past 4 quarters± 4.2%And the value of the current option is somewhatWaritakaIt suggests that it is.