• Earlier this week, Microsoft said it will invest US$17.50 billion in India from 2026 to 2029 to expand AI and cloud infrastructure, including new data centers, sovereign cloud options, and large-scale skilling programs tied to national digital platforms.

• The move underlines how central India’s huge developer base and digital public infrastructure have become to Microsoft’s AI ambitions and competition with global cloud rivals.

• We’ll now explore how this record India AI and cloud build-out could influence Microsoft’s existing investment narrative around durable growth.

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To own Microsoft, you need to believe its heavy AI and cloud spending will translate into durable, high-margin subscription and infrastructure revenue. The US$17.50 billion India build-out reinforces the near term AI capacity and Azure growth catalyst, while also amplifying the key risk around elevated CapEx and the pressure this can place on free cash flow if AI demand ever cools. Overall, the India news supports the existing growth narrative rather than changing it.

Among recent announcements, Microsoft’s plan to raise prices on Office and Microsoft 365 for commercial customers from July 1, 2026, is especially relevant. It highlights how AI infused products like Copilot can potentially lift average revenue per user, helping to offset the heavy data center and AI infrastructure spending required for expansions such as the India investment and supporting the broader cloud and subscription growth thesis.

Yet against this expansion story, investors should also be aware that elevated AI data center CapEx could…

Read the full narrative on Microsoft (it’s free!)

Microsoft’s narrative projects $425.0 billion revenue and $158.4 billion earnings by 2028. This requires 14.7% yearly revenue growth and a $56.6 billion earnings increase from $101.8 billion today.

Uncover how Microsoft’s forecasts yield a $625.41 fair value, a 31% upside to its current price.

The 130 fair value estimates from the Simply Wall St Community span roughly US$360 to US$625, showing how differently individual investors are sizing up Microsoft’s future. Against that spread, the India AI and cloud investment underlines how central ongoing, high CapEx has become to the company’s growth story and to its future execution risk.

Explore 130 other fair value estimates on Microsoft – why the stock might be worth as much as 31% more than the current price!