Microsoft 1Q27 preview: Could Azure and Office both accelerate?

Bernstein previews Microsoft's 1Q27 results (due after the close on Oct 28), maintaining an Outperform rating and raising the price target to $662 from $660 (27x P/FE). The firm views the setup favorably: sentiment has improved but expectations remain reasonable, and it leans positive on the street's reaction. Bernstein expects both Azure and Office to accelerate sequentially. Microsoft guided Azure to 44-45% CC growth; Bernstein models 45.6% reported (about $32.6B), roughly a point above buy-side bogeys, helped by ~1GW per quarter of capacity coming online. M365 Commercial Cloud growth was restated ~1pt higher after resegmentation and the 1Q27 CC guide was revised up from 15% to 17%;