Analysts Cut Price Targets on Microsoft Stock (MSFT) Ahead of Q3 Earnings Report

Microsoft is set to release its fiscal Q3 2025 results on April 30, after the market closes.

Top analysts have lowered their price targets on Microsoft (MSFT) stock as the tech giant approaches its upcoming earnings release on April 30. Analysts have adjusted their near-term expectations due to various headwinds, including tariffs, AI adoption challenges, and broader macroeconomic uncertainty. Nonetheless, analysts stay bullish on MSFT stock for the long term. Additionally, with recent reports indicating that Microsoft may reconsider its ambitious capital expenditure plans for 2025, the market is closely watching for potential shifts in strategy.

Analyst Consensus on Microsoft’s Q3 Earnings

According to analysts, Microsoft will report earnings per share (EPS) of $3.22 for the third quarter of FY25, up from $2.94 a year ago. In terms of revenue, on average, analysts expect Microsoft to report $68.44 billion, marking a year-over-year increase of over 10%. Notably, revenue from the company’s Intelligent Cloud segment, which includes Azure, is forecasted to rise 18% to $26.13 billion.

Overall, continued strength in Microsoft’s cloud business is crucial for maintaining investor confidence given the current economic climate.

Analysts Adjust Price Targets amid Short-Term Headwinds

Recently, Piper Sandler analyst Brent Bracelin has lowered Microsoft’s price target to $435 from $520. Bracelin noted that application software stocks are facing “eroding investor sentiment” as industry growth slows for the fourth consecutive year and AI adoption faces setbacks. Despite this, Piper stated that the direct impact of tariffs on software models remains minimal. Bracelin kept his Buy rating on MSFT stock.

Likewise, Goldman Sachs’ five-star-rated analyst Kash Rangan reduced its price target for Microsoft to $450 from $500, maintaining a Buy rating as part of its fiscal Q3 earnings preview. Goldman believes that outcomes for the company’s three business units could vary widely as customers deal with ongoing macroeconomic volatility. Overall, the firm is bullish on Microsoft meeting its revenue growth target of 11% for FY25.

Last week, Citi also lowered its price target to $480 from $497, maintaining a Buy rating. The firm highlighted that Microsoft has outperformed other mega-caps amid macro uncertainty. However, Citi’s checks showed mixed results, with some early Azure renewals, though uptake of CoPilot was weak. Moreover, aligning with expectations for a broader economic slowdown, Citi’s four-star-rated analyst Tyler Radke adjusted Microsoft’s FY26 estimates down by three points on average across its key segments.

Is MSFT Stock a Good Buy?

According to TipRanks, MSFT stock has a consensus Strong Buy rating among 35 Wall Street analysts. That rating is based on 31 Buys and four Holds assigned in the last three months. The average Microsoft price target of $490.5 implies a 25% upside from current levels.

Year-to-date, MSFT stock has declined by 7%.

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