Dan Ives Calls Microsoft 'Scottie Scheffler Of Software' Ahead Of Earnings — Says Satya Nadella-Led Cloud Giant Is Firing On All Cylinders In AI Boom

Benzinga
2025.07.25 11:18
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Wedbush analyst Dan Ives likens Microsoft to golfer Scottie Scheffler ahead of its earnings report, predicting strong results driven by AI advancements. He maintains an Outperform rating with a $600 price target, suggesting Microsoft could reach a $4 trillion market cap this summer. Despite recent layoffs, Microsoft is expanding its AI team and expects significant revenue growth from AI adoption. The company has allocated $80 billion for capital expenditures in fiscal 2025 to enhance data center capacity.

Wedbush Securities analyst Dan Ives compared Microsoft Corp. MSFT to world No. 1 golfer Scottie Scheffler ahead of the tech giant’s fourth-quarter earnings release Wednesday after market close.

What Happened: “We expect more good news next week from Redmond as Nadella & Co. will deliver another robust quarter driven by the AI Revolution,” Ives wrote on X Friday. “The Scottie Scheffler of software is firing on all cylinders as this cloud stalwart is front and center as the core AI enterprise foundation.”

The comparison references Scheffler’s dominant performance in professional golf. The 29-year-old American has held the world No. 1 ranking for over 100 weeks and won four major championships, according to the Official World Golf Ranking.

Microsoft trades at $510.80, with analysts setting a consensus price target of $551.07 based on 30 ratings. Citigroup issued the highest target at $613 while JPMorgan set the lowest at $475 in May.

Ives maintains an Outperform rating with a $600 price target, calling it “probably conservative.” He projects Microsoft will join Nvidia Corp. NVDA in the $4 trillion market cap club this summer, with potential for $5 trillion within 18 months.

Why It Matters: The Redmond-based company faces scrutiny over workforce decisions. Vice President JD Vance criticized Microsoft for laying off 9,000 American workers while increasing H-1B visa applications. CEO Satya Nadella addressed the cuts in an employee memo Thursday, saying the decisions “weigh heavily” on him.

Despite layoffs, Microsoft expanded its AI team by hiring approximately 24 employees from Alphabet Inc.‘s GOOGL GOOG DeepMind division. Ives expects over 70% of Microsoft’s installed base to adopt AI functionality within three years, potentially adding $25 billion in revenue by fiscal 2026.

Microsoft allocated $80 billion in capital expenditure guidance for fiscal 2025 to expand data center capacity and capitalize on AI demand trajectory.

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