Analyst: Microsoft's AI development will put pressure on Azure's short-term growth

Jinse Finance reported that on April 4, analysts at TD Cowen wrote in a report that Microsoft is developing its own advanced AI model, with the goal of launching it in 2027. This will require enormous computing power and could potentially limit the growth prospects of its Azure business. They pointed out that Microsoft’s CFO has already stated that computing resources will be prioritized for internal R&D, and this shift may have already been reflected in Microsoft’s current fiscal quarter outlook. The analysts wrote: “We do believe this will cap the upside and limit Azure’s ability to reaccelerate growth.” They expect that once the computing power required to train the new model starts to decrease, resources may be reallocated to Azure around mid-2027.