08:18 AM EDT, 03/20/2025 (MT Newswires) -- Microsoft ( MSFT ) shares have been under pressure due to concerns over AI-driven growth and competition, but recent checks with customers and partners reveal an acceleration in deal flow, boosting confidence in Azure's growth, Wedbush said in a note on Thursday.

AI annual recurring revenue continues to track ahead of expectations, reaching $13 billion last quarter, with projected growth in the coming years, the brokerage firm said.

Wedbush maintained its outperform rating and $550 price target, saying that Microsoft ( MSFT ) remains well-positioned to benefit from the AI revolution.

The cloud and Office 365/Windows ecosystem are also expected to drive future growth and margin improvements as Azure accelerates, Wedbush said.