CICC released a report stating that Microsoft (MSFT.US) exceeded both the bank's and the market's expectations for the first fiscal quarter ending in late September, benefiting from the continued promotion of AI in cloud and productivity-related businesses. The first fiscal quarter's commercial guidance growth of 30% exceeded expectations, providing assurance for future business growth, mainly driven by the growth in contracts of over 10 million US dollars for Azure and Microsoft 365.

CICC stated that the market's high expectations for Azure, which is expected to end the second fiscal quarter at the end of December, project a year-on-year revenue growth rate between 31% and 32%, lower than market expectations, leading to a slight decline in Microsoft's stock price after the earnings announcement. However, Microsoft indicated during the earnings call that the relatively weak Azure growth guidance for the current fiscal quarter is due to a bottleneck in computing power. The company remains optimistic about demand and reaffirms that the bottleneck in computing power is expected to ease by the second half of the 2025 fiscal year ending in June next year.

CICC continues to be bullish on Microsoft's deep synergies in the AI technology revolution, maintaining the company's revenue for fiscal years 2025 and 2026 unchanged. The forecast for net profit for the fiscal year 2025 remains unchanged. Considering the potential decrease in development costs for the fiscal year 2026, the net profit forecast for the fiscal year 2026 has been raised by 2.9% to 121.9 billion US dollars, while maintaining the company's 'outperforming the industry' rating with an unchanged target price of $490.