Microsoft (NASDAQ: MSFT) saw its stock price surge roughly 30% in the three weeks following its Q4 FY2026 earnings report, reaching highs near $520, before recently pulling back approximately 8%. Revenue for the quarter grew to $90 billion, an 18% year-over-year increase, with Azure achieving over $100 billion in annual revenue for the first time. The company’s contracted backlog also increased significantly, jumping by $51 billion to $678 billion, indicating strong future demand.
The dip in stock price could present a buying opportunity, as recent reports suggest that demand for Microsoft’s AI-enabled cloud services continues to exceed supply. Analysts note that while free cash flow has compressed due to increased capital expenditure in AI infrastructure, the overall health of Microsoft’s core business remains strong, with the firm not facing any financial distress, unlike some competitors.
Microsoft’s recent price action, with support found around the $480 level, shows signs of potential recovery. If the 50-day moving average crosses above the 200-day, it would indicate a positive trend shift. Investors are urged to consider this pullback not as a sign of weakness but as a chance to enter the stock before it resumes its upward trajectory.
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