Microsoft's Maia 200 Chip Set to Dominate AI Market

Written by Emily J. Thompson, Senior Investment Analyst

MSFT+2.19%

NVDA+1.1%

GOOGL+0.39%

Source: Fool

Updated: 1h ago

0mins

Source: Fool

Chip Release Milestone: Microsoft's Maia 200 chip, unveiled on January 26, is its second-generation in-house AI inference chip built on TSMC's 3-nanometer process, marking a significant step in the AI competition and expected to enhance the company's market position in AI.
Significant Performance Advantage: Maia 200 offers 30% better performance than competitors at the same price, addressing market price sensitivity and potentially attracting more customers to Microsoft's AI solutions, thereby increasing market share.
Revenue Growth Potential: The rollout of Maia 200 will reduce Microsoft's reliance on third parties and generate new revenue streams by making the chip available for rent to Azure cloud customers, which could lead to substantial financial returns for the company.
Cloud Services Growth: Microsoft reported a 40% increase in Azure and other cloud services revenue in its Q1 FY 2026 earnings report, and as Maia 200 becomes widely available, it is expected to further accelerate growth in cloud services, solidifying its market leadership.

MSFT

$480.58+Infinity%1D

Analyst Views on MSFT

Wall Street analysts forecast MSFT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSFT is 631.36 USD with a low forecast of 500.00 USD and a high forecast of 678.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

34 Analyst Rating

32 Buy

2 Hold

0 Sell

Strong Buy

Current: 470.280

Low

500.00

Averages

631.36

High

678.00

Current: 470.280

Low

500.00

Averages

631.36

High

678.00

Stifel

Brad Reback

Buy

downgrade

$640 -> $520

2026-01-26

New

Reason

Stifel

Brad Reback

Price Target

$640 -> $520

AI Analysis

2026-01-26

New

downgrade

Buy

Reason

Stifel analyst Brad Reback lowered the firm's price target on Microsoft to $520 from $640 and keeps a Buy rating on the shares ahead of the company's upcoming earnings report. The firm expects Microsoft to post about 200 basis points of Azure upside, or 39% constant currency growth, inline with buyside expectations, the analyst tells investors in a preview. While fiscal Q3 represents a more difficult year-over-year Azure comp, the firm believes Microsoft can post a similar level of incremental sequential adds as Q3 of FY25, resulting in about 38% year-over-year CC growth guidance given sizable recent datacenter capacity expansions, the analyst added. However, the firm believes the company must get to a point where Azure growth meaningfully outpaces capex growth rates for the stock to effectively re-rate in coming quarters.

UBS

Buy

maintain

$650 -> $600

2026-01-23

New

Reason

UBS

Price Target

$650 -> $600

2026-01-23

New

maintain

Buy

Reason

UBS lowered the firm's price target on Microsoft to $600 from $650 and keeps a Buy rating on the shares. The continued ramp of Microsoft's large Fairwater AI data centers in Atlanta and Wisconsin is emerging as a key near-term catalyst for Azure growth, with the Wisconsin site coming online in Q1, the analyst tells investors in a research note. Progress at the Wisconsin build-out supports a higher Azure growth outlook ahead of Microsoft's January 28 earnings report, UBS says.

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Citi

Buy

downgrade

$690 -> $660

2026-01-21

Reason

Citi

Price Target

$690 -> $660

2026-01-21

downgrade

Buy

Reason

Citi lowered the firm's price target on Microsoft to $660 from $690 and keeps a Buy rating on the shares. Citi's reseller survey and partner data points were "more mixed" into Microsoft's fiscal Q2 results, the analyst tells investors in a research note. Citi expects an Azure beat in Q2 but reduced estimates for Microsoft's non-Azure businesses on weaker PC forecasts. The stock remains a top mega-cap idea at Citi.

Rothschild & Co Redburn

Alex Haissl

Neutral

downgrade

$500 -> $450

2026-01-21

Reason

Rothschild & Co Redburn

Alex Haissl

Price Target

$500 -> $450

2026-01-21

downgrade

Neutral

Reason

Rothschild & Co Redburn analyst Alex Haissl lowered the firm's price target on Microsoft to $450 from $500 and keeps a Neutral rating on the shares.

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.