Microsoft Stock Outlook: 2 Key Reasons to Buy and Hold MSFT Forever

Stocks to buy

Microsoft (NASDAQ:MSFT) stock is in a solid position that drives revenue from diverse streams. Its productivity apps target white-collar workers, and its Windows OS is widely used globally. Additionally, Azuere Cloud is gaining more traction and market share.

Over 65% of Fortune 500 companies use OpenAI Services. Moreover, its cloud revenue also spiked up to $35 billion, signifying multiyear Azure deals. Consequently, MSFT stock should remain highly sought after.

CoPilot+ Adds More Advanced Features

Microsoft has introduced AI-powered PCs in a bid to enhance its market share amid fierce competition. The new Windows PCs, integrated with Copilot+, feature advanced AI capabilities beyond typical cloud offerings, addressing latency and privacy issues.

These PCs, using small language models and neural processing units , aim to save users on fees and expand AI technology frontiers.

Microsoft introduced the Recall feature, allowing easy file access without tedious searches.

They also unveiled Cocreate, an upgrade from Image Creator, enabling art creation on Paint and Photos using natural language and ink strokes. Traditional cloud-based services encounter delays, limits on images, and privacy concerns.

Microsoft announced that Copilot+ PCs enable free, fast image generation with fine-tuning and collection features.

The new PCs will support AI functionalities in various applications, including Adobe’s flagship offerings. These PCs stand out with live captions, studio effects, and an eye contact teleprompter.

New AI Model and MSFT Stock

Microsoft-backed OpenAI announced it formed a new safety committee and began training its next AI model to address safety concerns.

This move aims to improve perceptions of OpenAI leadership and ease worries about AI safety and internal instability following senior scientists’ departures and the dissolution of the former “Superalignment” team.

OpenAI announced the formation of a Safety and Security Committee, led by CEO Sam Altman, board chair Bret Taylor, and board members Adam D’Angelo and Nicole Seligman.

The committee will recommend critical safety and security decisions for all projects within 90 days. Additionally, OpenAI has started training its next AI model, expecting it to enhance their capabilities significantly.

The new committee’s establishment aimed to address AI safety concerns after reports of OpenAI dissolving its “Superalignment” team.

Introduced in July 2023, the team focused on aligning AI systems for safety, led by Ilya Sutskever and Jan Leike. Both Sutskever and Leike departed OpenAI earlier this month.

MSFT Stock Remains a Strong Buy

Microsoft’s pioneering investments in OpenAI positioned it as a catalyst for the AI revolution.

The company has emerged as the unrivaled leader in AI software, reflected in its soaring stock price, up 58% in two years, trading at 37.22-times trailing earnings. 

With innovations like Phi-3, Microsoft experiences an uptick in large Azure deals, contributing to its $35 billion revenue. This drives demand for MSFT stock, so I think long-term investors only stand to gain by holding this stock in their portfolio long term.

The AI revolution remains far from over, and Microsoft is likely to remain a key beneficiary of these trends.

On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

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