Microsoft capex priority to drive better returns over medium term, says Goldman

Goldman Sachs keeps a Buy rating and $600 price target on Microsoft (MSFT). The firm believes that the company’s prioritizing compute capex for first party applications – Copilot – and internal R&D – or Microsoft AI – over short-term Azure revenue will ultimately drive more strategic AI positioning across multiple layers of the technology stack and better returns over the medium term, the analyst tells investors in a research note.