Microsoft Gets Rare Downgrade as Stifel Warns on Azure Growth

Microsoft Corp. was hit with a rare analyst downgrade, in the latest sign of how caution toward software companies is even spreading to some of the biggest and most influential names.

Stifel cut the stock to hold from buy in a note dated Feb. 4, writing that consensus expectations for 2027 “are too optimistic.” Analyst Brad Reback also flagged two issues that contributed to a historic selloff in the stock following its results last week: the pace of growth in Microsoft’s Azure cloud-computing business, and the heavy amount it is spending on artificial intelligence.