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Positive bias from a higher target and belief that Azure pricing benefits will accrue; however, near-term upside is tempered by the view that pricing will flow in gradually rather than provide an instant uplift. Historical parallels show pricing effects can lag capacity-driven growth, creating delayed but meaningful upside.
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BNP Paribas Equity Research sees Azure pricing benefits accruing gradually rather than immediately, as MSFT emphasizes renewals over new pricing economics. OpenAI revenue sharing remains capped while MSFT grows through capacity and efficiency; the firm maintains a positive stance with a $549 target (~11% upside). The setup hinges on ongoing AI compute demand, capacity expansion, and eventual pricing normalization feeding Azure revenue.
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