Microsoft is starting to get AI, this investor says

Harris Douglas Asset Management portfolio manager Paul Harris says Microsoft (Microsaft Stock Quote, Chart, News, Analysts, Financials NASDAQ:MSFT) remains deeply embedded in enterprise workflows, supporting its AI opportunity.

Speaking on BNN Bloomberg’s Market Call on Sept. 28, Harris said it is unlikely businesses will move away from Microsoft Office given how tightly it is connected to day-to-day operations.

The investor said Microsoft’s Copilot AI product was initially clunky, but is improving.

Harris said Azure revenue growth remains strong, while Microsoft’s cloud infrastructure gives the company flexibility to monetize capacity and recover some of its AI-related spending.

He argued that Microsoft’s advantage is its existing enterprise customer base.

“If you’re going to go use an AI product, you probably want to use something that you’re very familiar with,” Harris said.

The fund manager believes Microsoft is well positioned because common AI use cases, such as writing emails, drafting memos and preparing presentations, are already integrated into Microsoft’s software suite.

Harris said the company is gradually embedding AI across its businesses, while its other operations remain strong.

“I don’t think people are ripping out Office to just go do something else,” he said.

Of the analysts covering Microsoft, 69 rate it “Buy,” three rate it “Hold” and none rate it “Sell,” with a consensus target of US$570.05.

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