Wedbush Views Microsoft (MSFT)’s Restructured OpenAI Partnership As Net Positive Rather Than Strategic Failure

With a short float of 1.08% and upside potential of 36.80%, Microsoft Corporation (NASDAQ:MSFT) earns a place on our list of the best cloud stocks to buy as Azure growth hits 40%.

RoSonic/Shutterstock.com

Microsoft Corporation (NASDAQ:MSFT)’s restructured OpenAI partnership raised concern among investors, with the stock down roughly 15% so far this year. However, not everyone saw the restructuring through a bearish lens.

On May 13, 2026, Wedbush analyst Daniel Ives stood behind Microsoft Corporation (NASDAQ:MSFT) with an “Outperform” rating and a $575 price target, viewing the revised deal as a net positive rather than the strategic failure the market appears to be treating it as.

Under the restructuring, OpenAI’s revenue share to Microsoft Corporation (NASDAQ:MSFT) is now capped at $38 billion through 2030, a reduction from the previous arrangement. However, the removal of OpenAI’s prior option to defer payments to 2032 means Microsoft actually receives more in the near term, approximately $6 billion this year, versus the $4 billion previously expected.

The analyst cited other key tailwinds: IP rights to OpenAI’s models are locked in through 2032, Microsoft Corporation (NASDAQ:MSFT) stays on as OpenAI’s primary cloud provider, the equity stake survives into what could be a significant IPO, and the revenue-sharing requirement on Azure sales of OpenAI models is dropped entirely.

Bill Ackman read the situation similarly, stating:

“We view Microsoft’s recent decision to restructure its OpenAI partnership not as a concession but as part of a deliberate pivot toward a more open, multi-model architecture that better serves ‌enterprise customers.”

The underlying business momentum reinforced both views.

On April 29, 2026, Microsoft Corporation (NASDAQ:MSFT) reported fiscal third-quarter 2026 revenue of $82.9 billion, up 18% year-over-year, with Azure and cloud services up 40% and total cloud revenue climbing 29% to $54.5 billion. The AI segment crossed a $37 billion annualized revenue run rate.

Looking ahead, fourth-quarter Azure growth is guided at 39%-40% in constant currency, ahead of the 36.7% consensus.

Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops and sells a wide range of software, cloud services, devices, and business solutions, serving both individual users and enterprise customers worldwide. Its flagship products include Windows, Microsoft 365, Azure, LinkedIn, and Xbox.

While we acknowledge the potential of MSFT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.