Microsoft is the biggest investor in ChatGPT-parent OpenAI, and the company has poured billions of dollars into the artificial intelligence (AI) startup. However, The Information reported that OpenAI is seeking to cut Microsoft’s revenue share by half to 10% by 2030. 

In this article, we’ll look at Microsoft’s outlook in light of the report. But before that, let’s dive into the factors that have helped drive the stock’s outperformance in 2025.

With a YTD gain of 3.7%, Microsoft (MSFT) is the best-performing member of the “Magnificent 7” and one of only two constituents that is in the green in 2025.

Microsoft Is the Only Defensive Play in the Magnificent 7

Microsoft now appears to be the only defensive play among mega-cap tech companies. 

While no business is immune to an economic slowdown or a recession, Microsoft looks to be the best-placed among its Magnificent 7 peers. Microsoft justified its YTD outperformance and reported better-than-expected numbers for the March quarter, after which the stock jumped 7.6%. While the overall tech sector’s earnings were reasonably good, Microsoft’s performance stands out. From beats on the top and bottom lines, stellar performance in the cloud business, better-than-expected guidance for the current quarter, and reassuring commentary on its artificial intelligence (AI) initiatives, Microsoft’s earnings report was as good as it can get, especially when we talk about a $3 trillion behemoth.

MSFT Stock Price Forecast

Microsoft, incidentally, happens to be the only Magnificent 7 stock apart from Amazon (AMZN) that doesn’t have any “Sell” or equivalent rating from analysts. 

Notably, while brokerages went into overdrive, cutting target prices for Big Tech companies following tariff announcements early in April, Microsoft did not see any major cuts. On the contrary, several analysts raised their target prices after the company’s fiscal Q3 2025 earnings release late last month. Among major such adjustments, D.A. Davidson raised Microsoft’s target price from $450 to $500 while Jefferies raised its target from $475 to $550. Microsoft has a mean target price of $507.98, which is 17.2% higher than the May 7 closing price.

OpenAI-Microsoft Relationship Might Be Soured

Microsoft has been among the biggest backers of OpenAI, and the two companies complement each other well. As part of the arrangement between the two companies, Microsoft gets access to OpenAI’s AI technology, and the latter is also a customer for its cloud computing segment.

Meanwhile, several reports have suggested that the relationship between Microsoft and OpenAI has strained somewhat due at least in part to differences over AI development. Microsoft is no longer the exclusive cloud computing supplier for OpenAI. OpenAI has also dropped plans to restructure the business into a “for-profit” enterprise and said that its nonprofit arm will keep control of the business. 

Should You Buy MSFT Stock?

I have been bullish on Microsoft stock for the last couple of months and I continue to remain optimistic about the Windows maker despite reports of its strained relations with OpenAI. Microsoft looks well placed amid the current macro environment, and its revenue stream is diversified and spread across the core Windows and Office franchises, premium subscription products, advertising, cloud, gaming, and LinkedIn.  MSFT stock trades at around 30x its expected earnings over the next 12 months. Its multiples are reasonable to me. 

Microsoft's AI strategy seems to be on the right track, and during the recent earnings call, it said that more than 15 million people are now using its GitHub Copilot assistant, with the number rising by over fourfold compared to last year. 

Overall, despite reports of OpenAI planning to slash Microsoft's revenue share, I still find Microsoft a good bet and believe that the company has a fair chance of becoming the first $4 trillion market cap enterprise.