Microsoft Corp.'s (Microsoft (MSFT)) latest earnings report has analysts feeling pretty good—even if the stock market isn't quite on the same page. Shares dipped about 5% on Thursday, but the commentary from Wall Street and industry experts suggests the company's AI story is gaining real traction.

Patrick Moorhead: AI Momentum And Spending Confidence Hold

Moor Insights and Strategy CEO Patrick Moorhead told CNBC on Thursday that Microsoft's results reinforce the strength of the ongoing AI investment cycle, with key signals supporting continued momentum.

He pointed to three critical factors underpinning the AI narrative: sustained capital spending, solid or accelerating cloud growth, and clear signs of real demand beyond hype.

Moorhead noted that Microsoft and its peers continue to maintain capital expenditure plans while delivering strong cloud performance.

He highlighted Copilot as a key positive, saying Microsoft released strong usage metrics at a crucial time, helping validate genuine AI adoption even though the product still represents a small share of its overall base.

He added that hyperscalers remain confident in their spending outlook, with no indication of pullbacks. However, investors still seek clarity on long-term demand trends and the evolving impact of partnerships such as OpenAI.

Brent Thill: Steady Execution With AI Profitability Signals

Jefferies analyst Brent Thill told CNBC on Thursday that Microsoft delivered a steady and consistent quarter, reinforcing the view that AI investments can generate profits while supporting margin expansion.

He noted that Azure grew in the high-30% range and Microsoft 365 in the mid-teens, with capital spending and operating margins both remaining well controlled.

Thill highlighted strong growth in remaining performance obligations, which rose 99%, as a signal of future demand.

He also pointed to management commentary indicating that Microsoft is successfully monetizing AI.

At the same time, he said the company's performance appears stable rather than a breakout, especially compared with peers like Alphabet Inc. (Alphabet (GOOGL)) Google, which showed stronger backlog growth, and Amazon.com Inc. (Amazon (AMZN)), which posted slightly softer cloud growth.

He added that Microsoft faces a two-part dynamic, with strength in its infrastructure business offset by concerns that AI could disrupt its applications segment.

Overall, he said the company is delivering the consistency management has emphasized, even without a major upside surprise.

Tal Liani: AI Adoption Accelerates, Integration Strategy Drives Outlook

Bank of America Securities analyst Tal Liani told CNBC on Thursday that Microsoft's results addressed prior concerns around Azure growth and Copilot adoption, strengthening confidence in its AI strategy.

He highlighted that cloud and Azure revenue rose 40%, while AI annual recurring revenue reached $37 billion, up 123% year-over-year, reflecting strong enterprise demand.

Liani also pointed to a sharp rebound in Copilot usage, which grew 250% year-over-year, signaling improving traction.

He emphasized that Microsoft is not focused on building the best standalone AI model but instead on integrating AI across its ecosystem, positioning Copilot as an orchestration layer that leverages multiple models.

He said Microsoft's ability to embed AI into workflows across products like Office and Dynamics gives it a structural advantage.

Looking ahead, Liani identified continued AI-driven revenue growth and conversion of backlog into sales as key catalysts, while maintaining a $500 price forecast and noting that AI presents both risks and opportunities for the company.

Microsoft Price Action

MSFT Price Action: Microsoft shares were down 5.05% at $403.01 at the time of publication on Thursday, according to market data.