Microsoft’s AI edge fuels growth, eyes $4 trillion valuation milestone

Despite being the world’s second most valuable company, Microsoft is poised for further growth as internal AI deployments have saved over $500 million in call centers and significantly boosted productivity, efficiency, and satisfaction across multiple business functions

Microsoft is witnessing renewed momentum in its stock performance and operational efficiency, driven by deep integration of artificial intelligence (AI) across its products and internal systems. The company’s AI-first strategy has helped propel its stock to record highs this year, gaining nearly 20% and closing at $503.51 on July 9, with a market capitalization of $3.742 trillion.

While Microsoft now holds the second spot globally in terms of valuation, analysts say the software giant still has room to grow—powered largely by its AI-driven innovations. The company’s Chief Commercial Officer Judson Althoff, in a recent internal briefing, revealed that Microsoft has generated over $500 million in savings at its call centers this year alone, thanks to AI-based automation and enhancements. The internal deployment of AI has streamlined operations across customer service, sales, and engineering, with measurable gains in both employee productivity and customer satisfaction.

Althoff noted that AI now contributes to 35% of the code used in developing new Microsoft products, significantly shortening time-to-market. He emphasized that AI is not replacing human talent but is enabling employees—particularly in sales—to work more effectively. Microsoft’s Copilot assistant has helped sales personnel increase revenue by 9%, enabling them to close deals faster and identify better leads.

The company has also started leveraging AI to improve interactions with smaller clients, unlocking new revenue opportunities worth tens of millions of dollars. These use cases, alongside its AI-enhanced platforms, are strengthening Microsoft’s competitive edge at a time when businesses across sectors are accelerating digital transformation.

Azure, Copilot fuel market optimism

On the market front, Microsoft’s AI performance has earned bullish views from leading analysts. Oppenheimer recently upgraded the stock to “Outperform” with a $530 price target, citing strong AI execution and the potential reacceleration of Azure revenue in fiscal 2026. Analyst Brian Schwartz remarked that Microsoft’s stock doesn’t yet fully reflect its AI growth trajectory.

Wedbush analyst Daniel Ives, too, raised his target to $600, pointing to strong enterprise adoption of Azure and Copilot. He predicted Microsoft and Nvidia are on track to hit $4 trillion in valuation soon—possibly even entering the $5 trillion club within 18 months, as the AI-led tech rally continues.

To reach the $4 trillion mark, Microsoft stock would need to rise by another $35, a milestone seen as increasingly achievable amid its expanding AI footprint and strong market confidence.