Microsoft (MSFT US) Buy: Anthropic may prove USD43bn p.a. opportunity

Research evidence excerpt

Microsoft (MSFT US) Buy: Anthropic may prove USD43bn p.a. opportunity

e requirement spending will be 60%

600.00

of its revenue, it could amount to a USD144bn annual revenue opportunity for cloud

infrastructure providers. If Microsoft Azure garners 30% share in that opportunity (in 460.00

line with our 2030 market share estimates), this could result in being a USD43bn per 320.00

annum opportunity for Microsoft by 2030e. 05/25 Target price:11/25571.00 05/26

High: 542.07 Low: 356.77 Current: 418.57

Strong long-term growth aided by high capex: Azure posted stellar 40% y-o-y Source: LSEG IBES, HSBC estimates

(+39% in constant currency) revenue growth off a large base in 3QFY26, and the

company guided to Azure 4QFY26 constant-currency growth of 39-40% along with Stephen Bersey

further acceleration in 1HFY27. However supporting this growth requires investment, Head of US Technology Research HSBC Securities (USA) Inc.

and capital expenditure for Microsoft (mostly for Azure) was USD31.9bn in that stephen.bersey@us.hsbc.com

+1 212 525 4153

quarter. Moreover, management guided to 4QFY26 capex of more than USD40bn,

with an implied 1HFY27 capex of cUSD117bn, such that CY26 capex could exceed Abhishek Shukla*, CFA Senior Analyst, Technology

USD190bn. We support the company’s aggressive investment strategy and see AI HSBC Bank Middle East Limited, DIFC

abhishek2.shukla@hsbc.com

compute demand outpacing supply for several years, positioning the company at the +971 4 5093343

center of a massive AI supercycle. We expect Microsoft’s CY25-27 revenue CAGR of Sameer Lam*

21.3% and non-GAAP EPS CAGR of 20.8% driven largely by sharp growth within Global Software Analyst

HSBC Bank plc

Azure and other developing AI software services. sameer.lam@hsbc.com

+44 20 7992 3780