SCHX, EGLE: Big ETF Outflows
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 20 2025
0mins
Should l Buy MSFT?
Source: NASDAQ.COM
ETF Outflows: The Global X S&P 500 US Revenue Leaders ETF experienced the largest outflow, losing 40,000 units, which is a 40.0% decline compared to the previous week.
Market Performance: In morning trading, Microsoft saw a slight increase of about 0.1%, while Amazon.com experienced a decrease of approximately 0.7%.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy MSFT?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on MSFT
Wall Street analysts forecast MSFT stock price to rise
34 Analyst Rating
32 Buy
2 Hold
0 Sell
Strong Buy
Current: 401.840
Low
500.00
Averages
631.36
High
678.00
Current: 401.840
Low
500.00
Averages
631.36
High
678.00
About MSFT
Microsoft Corporation is a technology company that develops and supports software, services, devices, and solutions. Its Productivity and Business Processes segment consists of products and services in its portfolio of productivity, communication, and information services, spanning a variety of devices and platforms. It comprises Microsoft 365 Commercial products and cloud services; Microsoft 365 Consumer products and cloud services; LinkedIn, and Dynamics products and cloud services. The Intelligent Cloud segment consists of its public, private, and hybrid server products and cloud services. It comprises server products and cloud services, including Azure, and enterprise and partner services, including Enterprise Support Services. Its More Personal Computing segment primarily comprises Windows and Devices, including Windows OEM licensing; Gaming, including Xbox hardware and Xbox content; Search and news advertising, comprising Bing and Copilot, Microsoft News, and Microsoft Edge.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Microsoft's Copilot User Growth and Market Potential
- User Growth Data: Microsoft revealed that Copilot reached 15 million paying users in its latest earnings call, reflecting a 160% year-over-year growth, although this figure appears small compared to its 450 million Microsoft 365 paid users, indicating potential market demand.
- Market Competition Analysis: While Copilot's conversion rate stands at approximately 3.3%, lower than ChatGPT's 5%, Microsoft's existing user base provides a solid opportunity for future growth through cross-selling, especially as AI tools become more mainstream.
- Revenue Potential Outlook: Should Microsoft achieve another 160% growth in users over the next year, it could generate an additional $8.6 billion in revenue, which represents nearly 3% of its projected $328 billion revenue for fiscal year 2026, highlighting Copilot's commercial value.
- Strategic Positioning and Competitive Advantage: With significant equity stakes in both OpenAI and Anthropic, Microsoft can leverage AI to enhance Microsoft 365's competitiveness, thereby maintaining its leadership in the office software market and mitigating competitive pressures in the future.
See More
Microsoft Faces Intensifying Competition in Cloud Computing
- Cloud Competition: Microsoft faces fierce competition in the cloud computing sector from Amazon and Alphabet, with Azure's revenue growth of 39% lagging behind Google Cloud's 48%, indicating market share pressures.
- Rising Infrastructure Costs: The company's increasing infrastructure costs have raised concerns among investors, as CFO Amy Hood noted a direct correlation between capital expenditures and Azure's revenue, potentially impacting future returns on investment.
- Stock Valuation Decline: Microsoft's price-to-earnings (P/E) ratio has fallen to 25, nearing its lowest level in three years, reflecting market caution regarding its growth prospects, despite analysts' price target of $596 suggesting a 48% upside.
- Investor Sentiment Weakens: Following the earnings report on January 28, Microsoft's stock has dropped 16%, leading to investor doubts about the returns from its AI infrastructure investments, although the low valuation may present a buying opportunity in the long run.
See More
Hyperscalers Set to Boost Cloud Spending Significantly
- Spending Overview: The five largest hyperscalers, including Amazon, Alphabet, Microsoft, Meta, and Oracle, are projected to budget over $700 billion by 2026, reflecting a strong demand for building AI data centers and driving growth in related sectors.
- Capital Expenditure Growth: Amazon plans to spend $200 billion in 2026, a 56% increase from $128.3 billion in 2025; Alphabet's spending is expected to reach $180 billion, with a staggering 97% year-over-year growth, significantly enhancing its market competitiveness.
- Surge in Chip Demand: These five companies are set to spend over $450 billion on GPUs, CPUs, and other AI accelerator chips in 2026, creating substantial market opportunities for chipmakers, particularly for leading firms like Taiwan Semiconductor Manufacturing Company (TSMC).
- Long-Term Growth Outlook: TSMC has raised its annual revenue growth forecast for 2024-2029 from 20% to 25%, and with the rapid increase in AI chip demand, the potential for gross margin and profit growth in the coming years is substantial, making it a valuable investment despite its stock reaching all-time highs.
See More
Building Long-Term Wealth with Dividend Stocks
- Dividend Stock Advantages: According to Ned Davis Research, from 1973 to 2024, dividend growers and payers have an average annual total return of 10.24%, significantly outperforming non-payers at 4.31%, highlighting the compelling nature of dividend stocks for long-term investment.
- Microsoft's Growth Potential: Microsoft (MSFT) has averaged a 24% annual gain over the past decade, and despite a 17% decline year-to-date, its dividend yield has risen to 0.9%, with annual dividends increasing from $1.89 in 2019 to $3.64 in 2023, reflecting strong profitability and ongoing shareholder returns.
- Medtronic's Stable Returns: Medtronic (MDT) has raised its dividend by an average of 6% annually over the past decade and has increased its dividend for 48 consecutive years, currently yielding 2.8%, while its second-quarter revenue rose 7% year-over-year, demonstrating robust performance in the medical device sector.
- ETF Investment Opportunity: The Schwab U.S. Dividend Equity ETF (SCHD) offers a 3.5% dividend yield and tracks the Dow Jones U.S. Dividend 100 Index, which includes 100 stocks that have paid dividends for at least 10 years, with a low annual fee of just 0.06%, providing investors with a cost-effective diversified investment option.
See More
Oracle Shares Plunge 40% Amid AI Concerns
- Stock Plunge: Oracle's shares have fallen approximately 40% since late October, primarily due to investor concerns over its debt-financed AI data centers and heavy reliance on OpenAI workloads, indicating skepticism about its sustainable growth potential.
- Debt Financing Pressure: Despite raising tens of billions to expand capacity and promoting its role in training OpenAI models, the market is beginning to question the viability of this strategy, which was once seen as a transformative growth engine, reflecting a reassessment of its fundamentals.
- Microsoft's AI Burden: Microsoft's commercial cloud remaining performance obligations have surged to about $625 billion, with roughly 45% tied directly to OpenAI, raising concerns about its future financial health and potentially impacting its stock performance.
- Market Confidence Eroded: OpenAI CEO Altman's firm response to investor doubts starkly contrasts with market reactions, as stocks related to Oracle, Microsoft, and Broadcom have suffered steep declines due to skepticism surrounding OpenAI's commitments, despite Altman's assurances of steep revenue growth.
See More
Broadcom's Rise in the AI Sector
- Surging AI Revenue: Broadcom reported a 74% year-over-year increase in AI semiconductor revenue for the latest quarter, with projections indicating that first-quarter revenue will double to $8.2 billion, driven by strong demand for custom accelerators and AI Ethernet switches, significantly boosting overall performance.
- Record Backlog: The company's backlog for AI switches has surpassed $10 billion, reflecting robust market demand amid ongoing AI data center buildouts, which further solidifies Broadcom's position in the industry.
- Differentiated Product Offering: Broadcom has launched the industry's first Wi-Fi 8 access point and switch system, designed to enhance security and speed for enterprises utilizing AI, thereby increasing its competitive edge and attracting more customers.
- Unique Market Positioning: Broadcom's XPUs are custom chips tailored for specific purposes, differentiating them from Nvidia and AMD's general-purpose GPUs, allowing the company to carve out a niche in the competitive AI market and enhancing its strategic positioning for future growth.
See More
Microsoft's Copilot User Growth and Market Potential
- User Growth Data: Microsoft revealed that Copilot reached 15 million paying users in its latest earnings call, reflecting a 160% year-over-year growth, although this figure appears small compared to its 450 million Microsoft 365 paid users, indicating potential market demand.
- Market Competition Analysis: While Copilot's conversion rate stands at approximately 3.3%, lower than ChatGPT's 5%, Microsoft's existing user base provides a solid opportunity for future growth through cross-selling, especially as AI tools become more mainstream.
- Revenue Potential Outlook: Should Microsoft achieve another 160% growth in users over the next year, it could generate an additional $8.6 billion in revenue, which represents nearly 3% of its projected $328 billion revenue for fiscal year 2026, highlighting Copilot's commercial value.
- Strategic Positioning and Competitive Advantage: With significant equity stakes in both OpenAI and Anthropic, Microsoft can leverage AI to enhance Microsoft 365's competitiveness, thereby maintaining its leadership in the office software market and mitigating competitive pressures in the future.
See More
Microsoft Faces Intensifying Competition in Cloud Computing
- Cloud Competition: Microsoft faces fierce competition in the cloud computing sector from Amazon and Alphabet, with Azure's revenue growth of 39% lagging behind Google Cloud's 48%, indicating market share pressures.
- Rising Infrastructure Costs: The company's increasing infrastructure costs have raised concerns among investors, as CFO Amy Hood noted a direct correlation between capital expenditures and Azure's revenue, potentially impacting future returns on investment.
- Stock Valuation Decline: Microsoft's price-to-earnings (P/E) ratio has fallen to 25, nearing its lowest level in three years, reflecting market caution regarding its growth prospects, despite analysts' price target of $596 suggesting a 48% upside.
- Investor Sentiment Weakens: Following the earnings report on January 28, Microsoft's stock has dropped 16%, leading to investor doubts about the returns from its AI infrastructure investments, although the low valuation may present a buying opportunity in the long run.
See More
Hyperscalers Set to Boost Cloud Spending Significantly
- Spending Overview: The five largest hyperscalers, including Amazon, Alphabet, Microsoft, Meta, and Oracle, are projected to budget over $700 billion by 2026, reflecting a strong demand for building AI data centers and driving growth in related sectors.
- Capital Expenditure Growth: Amazon plans to spend $200 billion in 2026, a 56% increase from $128.3 billion in 2025; Alphabet's spending is expected to reach $180 billion, with a staggering 97% year-over-year growth, significantly enhancing its market competitiveness.
- Surge in Chip Demand: These five companies are set to spend over $450 billion on GPUs, CPUs, and other AI accelerator chips in 2026, creating substantial market opportunities for chipmakers, particularly for leading firms like Taiwan Semiconductor Manufacturing Company (TSMC).
- Long-Term Growth Outlook: TSMC has raised its annual revenue growth forecast for 2024-2029 from 20% to 25%, and with the rapid increase in AI chip demand, the potential for gross margin and profit growth in the coming years is substantial, making it a valuable investment despite its stock reaching all-time highs.
See More
Building Long-Term Wealth with Dividend Stocks
- Dividend Stock Advantages: According to Ned Davis Research, from 1973 to 2024, dividend growers and payers have an average annual total return of 10.24%, significantly outperforming non-payers at 4.31%, highlighting the compelling nature of dividend stocks for long-term investment.
- Microsoft's Growth Potential: Microsoft (MSFT) has averaged a 24% annual gain over the past decade, and despite a 17% decline year-to-date, its dividend yield has risen to 0.9%, with annual dividends increasing from $1.89 in 2019 to $3.64 in 2023, reflecting strong profitability and ongoing shareholder returns.
- Medtronic's Stable Returns: Medtronic (MDT) has raised its dividend by an average of 6% annually over the past decade and has increased its dividend for 48 consecutive years, currently yielding 2.8%, while its second-quarter revenue rose 7% year-over-year, demonstrating robust performance in the medical device sector.
- ETF Investment Opportunity: The Schwab U.S. Dividend Equity ETF (SCHD) offers a 3.5% dividend yield and tracks the Dow Jones U.S. Dividend 100 Index, which includes 100 stocks that have paid dividends for at least 10 years, with a low annual fee of just 0.06%, providing investors with a cost-effective diversified investment option.
See More
Oracle Shares Plunge 40% Amid AI Concerns
- Stock Plunge: Oracle's shares have fallen approximately 40% since late October, primarily due to investor concerns over its debt-financed AI data centers and heavy reliance on OpenAI workloads, indicating skepticism about its sustainable growth potential.
- Debt Financing Pressure: Despite raising tens of billions to expand capacity and promoting its role in training OpenAI models, the market is beginning to question the viability of this strategy, which was once seen as a transformative growth engine, reflecting a reassessment of its fundamentals.
- Microsoft's AI Burden: Microsoft's commercial cloud remaining performance obligations have surged to about $625 billion, with roughly 45% tied directly to OpenAI, raising concerns about its future financial health and potentially impacting its stock performance.
- Market Confidence Eroded: OpenAI CEO Altman's firm response to investor doubts starkly contrasts with market reactions, as stocks related to Oracle, Microsoft, and Broadcom have suffered steep declines due to skepticism surrounding OpenAI's commitments, despite Altman's assurances of steep revenue growth.
See More
Broadcom's Rise in the AI Sector
- Surging AI Revenue: Broadcom reported a 74% year-over-year increase in AI semiconductor revenue for the latest quarter, with projections indicating that first-quarter revenue will double to $8.2 billion, driven by strong demand for custom accelerators and AI Ethernet switches, significantly boosting overall performance.
- Record Backlog: The company's backlog for AI switches has surpassed $10 billion, reflecting robust market demand amid ongoing AI data center buildouts, which further solidifies Broadcom's position in the industry.
- Differentiated Product Offering: Broadcom has launched the industry's first Wi-Fi 8 access point and switch system, designed to enhance security and speed for enterprises utilizing AI, thereby increasing its competitive edge and attracting more customers.
- Unique Market Positioning: Broadcom's XPUs are custom chips tailored for specific purposes, differentiating them from Nvidia and AMD's general-purpose GPUs, allowing the company to carve out a niche in the competitive AI market and enhancing its strategic positioning for future growth.
See More
