We recently published Top 9 AI and Non-Tech Stocks to Watch During Latest Earnings Season. Microsoft Corporation (NASDAQ:MSFT) is one of the best AI and non-tech stocks.
Treasury Partners’ Richard Saperstein said in a recent program on CNBC before Microsoft’s latest earnings report that he believed the company could deliver Azure growth in the mid-30s.
“Right, Microsoft’s value is constantly increasing, adding another 135 billion today, and it’s consistent with Microsoft being the intersection of software and AI. They’ve grown 33%. I think analysts are looking for mid-30s type growth, and we expect them to achieve that.”
Microsoft recently posted a strong quarter, exceeding analyst expectations for Azure with 40% year-over-year growth. What rattled investors was CapEX, which rose to about $35 billion in the September quarter, most of which went to Nvidia chips to address capacity bottlenecks in its cloud business. The CapEx figure was much higher than The Street’s forecast of about $30.34 billion.
Photo by Microsoft Edge on Unsplash
Wedgewood Partners in its statement stated the following regarding Microsoft Corporation (NASDAQ:MSFT). investor letter third quarter 2025:
“Microsoft Corporation (NASDAQ:MSFT) has also spent quite a bit of money on capital investments in recent years, adding more than 2 gigawatts of data center capacity in the last twelve months alone, but it has also delivered very attractive cash-low returns. The company ended fiscal 2025 with nearly $370 billion in gross property, plant and equipment and capitalized leases, a notable increase of $260 billion from fiscal 2020. Meanwhile, gross cash lows grew from $60 billion per year in 2020 to over $140 billion per year in 2025. When we add the rest of the assets on Microsoft’s balance sheet, we calculate that gross cash lows are a consistent return on capital in the high 20s. That is an extremely attractive return for such enormous investment amounts.”
While we recognize MSFT’s potential as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and carry limited downside risk. If you’re looking for an extremely cheap AI stock that’s also a big beneficiary of Trump tariffs and onshoring, check out our free report on the best AI stocks for short term.
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Disclosure: None. This article was originally published on Insider monkey.
