Microsoft (MSFT) stated that it has resolved the most pressing issues with its Azure cloud service after several undersea cables in the Red Sea were severed. The incident disrupted as much as 17% of global internet traffic and left users facing slower connections and higher latency. The company explained that customers in Asia, Europe, and the Middle East were the most affected since much of that traffic depends on cables that cross through the Red Sea.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
At first, Microsoft advised clients that connections could feel slower. However, the company later said its systems were stable again after engineers rerouted traffic through other paths. Even so, it warned that performance may not return to normal until repairs are complete. The firm added that its teams are monitoring and balancing flows each day to keep the impact limited.
Meanwhile, MSFT shares have declined 2.55% on Friday to stand at $495.
Repairs Face Regional Risk
The damaged cables include SEACOM/TGN-EA, AAE-1, and EIG. These are key links that connect Europe, Asia, and Africa. However, Microsoft did not give details on how the cables were cut. In the past, such problems have been caused by ship anchors or, in rare cases, by direct sabotage. In this case, the repair process may be more complex because of unrest in the area. Ongoing attacks on ships by Houthi forces in Yemen raise safety concerns for vessels that need to access the lines.
As a result, delays may persist for cloud users and telecom operators across several countries. Internet monitors in the Middle East and South Asia have already noted slower speeds. For now, Microsoft is relying on rerouting to keep Azure services running without major outages.
Is MSFT Stock a Buy?
Microsoft continues to boast a bullish view among the Street’s analysts with a Strong Buy consensus. The average MSFT stock price target stands at $627.67, implying a 26.80% upside from the current price.
