On Tuesday, Wall Street analyst Dan Ives said that investors are underestimating Microsoft Corp.'s
Microsoft Build Conference Signals Bigger AI Push Beyond Copilot
Speaking on CNBC's Closing Bell, the Wedbush Securities analyst said Microsoft's announcements at its annual Build developer conference reinforced his bullish outlook, arguing the company is strengthening its position in the intensifying AI arms race.
"They're defending their turf. They're going after developers," Ives said, adding that the market is undervaluing what he expects will become a stronger monetization phase over the next six to 12 months.
Microsoft unveiled a broad slate of AI initiatives at the conference, including autonomous AI agents, Nvidia Corp
The company introduced the Surface RTX Spark Dev Box, powered by Nvidia chips, alongside Project Solara prototypes - AI-focused devices designed to interact directly with cloud systems to complete tasks autonomously.
Ives said the announcements extend beyond Copilot and could further strengthen Microsoft's cloud business, particularly Azure.
Quantum Computing And Microsoft's Long-Term AI Strategy
On quantum computing, Ives suggested Microsoft should increase its exposure to the space, pointing to accelerating innovation trends across the technology sector.
"You want to see Microsoft dive into the deep end of the pool," he said, describing quantum as part of the broader "fourth industrial revolution."
Alphabet's $80 Billion AI Funding Plan Draws Support
Ives also backed Alphabet's newly announced $80 billion fundraising plan aimed at expanding AI infrastructure capacity.
Alphabet's financing package includes a $30 billion public offering, a $40 billion at-the-market equity program expected to begin in the third quarter and a $10 billion private placement with Berkshire Hathaway.
"I think that's a smart way to do it," Ives said, arguing that companies need to remain aggressive as AI infrastructure spending accelerates.
Despite concerns about investor sentiment shifting, Ives maintained that the AI boom remains in its early stages.
"We're still in the third inning of the AI revolution," he said.
Price Action: Microsoft shares closed Tuesday down 4.17% at $441.31 and slipped another 0.65% to $438.42 in after-hours trading.
Meanwhile, Alphabet Class A shares gained 0.32% in after-hours trading while Class C shares increased by 0.042%. During the regular hours, the shares declined by 3.86% and 3.81%, respectively.
Benzinga Edge Stock Rankings place GOOG in the 94th percentile for Quality, reflecting strong performance indicators across short, medium and long-term time frames.
