Why did Microsoft stock pop today? Strong cloud results get praise
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Microsoft (NASDAQ:MSFT) shares jumped more than 7% on Wednesday as Wall Street analysts heaped praise on its quarterly results and in particular, its Azure cloud computing unit.
Several analysts upgraded Microsoft (MSFT) shares, including Macquarie analyst Sarah Hindlian-Bowler, who raised her rating to outperform from neutral and boosted the per-share price target to $325.
Hindlian-Bowler said the results were a "solid beat despite the macro environment," citing strength in search and news advertising, Office, servers and intelligent cloud.
"Overall, with the company able to buck the macro, its opportunities to embed Generative Al into Office, Bing, and many other areas of the company suggest meaningful long term business opportunities," Hindlian-Bowler wrote in a note.
During the third quarter, Microsoft (MSFT) earned an adjusted $2.45 per share on $52.86B in revenue, topping estimates of $2.33 per share and $51B in revenue.
Looking ahead, Microsoft (MSFT) expects fourth-quarter revenue of $55.4B, topping the $54.7B that analysts expect. 
BMO analyst Keith Bachman, who also upgraded Microsoft (MSFT) shares to outperform, stated he now has "higher conviction" that any headwinds to Azure are likely to moderate by the end of the year, while opportunities in artificial intelligence can help the longer-term. 
"While the stock is not inexpensive, we think the durable growth opportunities warrant a premium valuation," Bachman wrote.
Citi analyst Tyler Radke reiterated the firm's buy rating on Microsoft (MSFT) and raised its per-share price target to $340 after the results, noting that the cost discipline the company has shown is likely to make it more profitable. 

In addition, Radke added that Microsoft (MSFT) is likely to continue involving generative artificial intelligence into its products and services and revenue growth should accelerate based on easier comparisons and continued execution.
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