Microsoft Corp. (NASDAQ:MSFT) stock slipped on Thursday after a report said the company’s Xbox division is preparing significant layoffs and budget cuts following the close of Microsoft’s fiscal year. The decline came despite a broader market rally, with the Nasdaq gaining 1.48% and the S&P 500 advancing 0.59%.
Xbox Plans Layoffs, Budget Cuts
Microsoft’s Xbox division is preparing significant layoffs and budget cuts next month as new CEO Asha Sharma moves to overhaul the gaming business amid declining revenue and profitability, Bloomberg reported Thursday.
The layoffs are expected shortly after Microsoft’s fiscal year ends on June 30. Xbox is also planning to reduce spending on marketing and other areas as it seeks to improve margins, according to the report.
Copilot Adoption Remains A Key Bull Case
Separately, BNP Paribas reiterated Microsoft as a top AI software and cloud infrastructure pick, with analyst Stefan Slowinski highlighting accelerating Copilot adoption, expanding enterprise deployments, and a potential evolution toward a higher-value seat-plus-consumption pricing model.
Following investor meetings with management, Slowinski said Microsoft could exceed its outlook for more than 25 million Copilot seats in the fiscal fourth quarter, supported by stronger customer usage, product improvements, and large-scale rollouts such as NHS England’s 500,000-seat deployment.
The analyst also noted Microsoft’s willingness to continue investing aggressively in AI infrastructure, calling the opportunity “generational.” BNP Paribas maintained its Outperform rating and $555 price forecast on Microsoft shares, implying roughly 40% upside from recent levels.
Analyst Consensus & Recent Actions: The stock carries a Buy rating with an average price forecast of $560.00. Recent analyst moves include:
- TD Cowen: Buy (Maintains forecast to $540.00) (June 4)
- Cantor Fitzgerald: Overweight (Maintains forecast to $502.00) (June 4)
- Citizens: Market Outperform (Maintains forecast to $550.00) (June 4)
Microsoft Technical Analysis
Microsoft is trading 7.7% below its 20-day SMA ($421.43) and 14.5% below its 200-day SMA ($454.86), which keeps the longer-term trend tilted lower despite periodic rebounds.
The stock is also 5% to 6% below its 50-day and 100-day averages, so bulls still need a sustained move back above that cluster to argue the downtrend is easing.
Momentum is best framed through MACD right now: MACD is below its signal line and the histogram is negative, which points to fading upside pressure versus the prior upswing unless buyers can reassert control.
Structurally, the January death cross (50-day moving below the 200-day) remains an overhang, even though the 20-day SMA is still above the 50-day SMA (a shorter-term bullish crossover that hasn’t translated into price strength yet).
- Key Resistance: $433.00 — a nearby ceiling that also sits close to the broader moving-average “gravity zone,” where rebounds have room to stall
- Key Support: $381.50 — a nearby floor just under current levels where buyers previously showed up, making it the first line to defend
Microsoft Price Action
MSFT Stock Price Activity: Microsoft shares were down 2.71% at $386.61 at the time of publication on Thursday, according to Benzinga Pro data.
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