We just covered Avoid ******* eX and Buy These 11 Stocks Instead. Microsoft (NASDAQ:MSFT) ranks #1 (see Avoid ******* eX and Buy These 5 Stocks Instead).
Number of Hedge Fund Investors: 282
Microsoft (NASDAQ:MSFT) is down 22 percent year-to-date, and Redditors believe now is the time to buy the stock instead of chasing hype like ******* eX.
Bulls point to Microsoft's latest agreement revisions with OpenAI announced in April 2026, after which Microsoft will no longer be obligated to pay 20 percent of Azure OpenAI Service and Bing revenue to OpenAI. This change will improve Microsoft's gross margins from 76.11 percent in 2026 to 82.35 percent. But the investment case is not just about OpenAI. Microsoft (NASDAQ:MSFT) is a strong cloud and AI play independent of that relationship. In fiscal Q3 2026, Azure revenue rose 40 percent year-over-year, marking the fourth consecutive quarter of 40 percent plus growth. Azure OpenAI enterprise customers rose 63 percent year-over-year from 49,000 in FY2024 to 80,000 in FY2025.
The market share gap between Azure and AWS has been declining from 23 percentage points in 2021 to just 9 percentage points in fiscal Q3 2026 year-to-date. Enterprise customer concentration remains a key advantage for Microsoft. Enterprise customers spending over 1.2 million dollars annually represent 5 percent of Azure's customer base compared to just 2.3 percent for AWS. Microsoft (NASDAQ:MSFT) plans to increase its data center supply capacity by 80 percent in fiscal 2026 and double the number of data centers over the next two years. Copilot paid seats rose 250 percent year-over-year to 20 million paid seats in Q3 FY2026, representing the fastest growth rate for any Microsoft software suite since launch. At an annual price of $360 per user, Copilot generates approximately 7.2 billion dollars in annualized revenue.
Number of Hedge Fund Investors: 282
Microsoft (NASDAQ:MSFT) is down 22 percent year-to-date, and Redditors believe now is the time to buy the stock instead of chasing hype like ******* eX.
Bulls point to Microsoft's latest agreement revisions with OpenAI announced in April 2026, after which Microsoft will no longer be obligated to pay 20 percent of Azure OpenAI Service and Bing revenue to OpenAI. This change will improve Microsoft's gross margins from 76.11 percent in 2026 to 82.35 percent. But the investment case is not just about OpenAI. Microsoft (NASDAQ:MSFT) is a strong cloud and AI play independent of that relationship. In fiscal Q3 2026, Azure revenue rose 40 percent year-over-year, marking the fourth consecutive quarter of 40 percent plus growth. Azure OpenAI enterprise customers rose 63 percent year-over-year from 49,000 in FY2024 to 80,000 in FY2025.
The market share gap between Azure and AWS has been declining from 23 percentage points in 2021 to just 9 percentage points in fiscal Q3 2026 year-to-date. Enterprise customer concentration remains a key advantage for Microsoft. Enterprise customers spending over 1.2 million dollars annually represent 5 percent of Azure's customer base compared to just 2.3 percent for AWS. Microsoft (NASDAQ:MSFT) plans to increase its data center supply capacity by 80 percent in fiscal 2026 and double the number of data centers over the next two years. Copilot paid seats rose 250 percent year-over-year to 20 million paid seats in Q3 FY2026, representing the fastest growth rate for any Microsoft software suite since launch. At an annual price of $360 per user, Copilot generates approximately 7.2 billion dollars in annualized revenue.
2 months ago
