Microsoft (MSFT) stock is down slightly in Thursday's session after a leaked internal memo revealed the tech giant's decision to eliminate approximately 650 roles at its Xbox gaming division.
"As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming – mostly corporate and supporting functions – to organize our business for long term success," said Microsoft Gaming CEO Phil Spencer in a memo obtained by CNBC. "With these changes, our corporate and supporting teams and resources are aligned for sustainable future growth, and can better support our studio teams and business units with programs and resources that can scale to meet their needs."
Spencer added that there will be no games, devices or experiences canceled and no studios closed as result of these job cuts.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
This is the third round of layoffs in the Xbox gaming division since Microsoft closed its $69 billion acquisition of Activision Blizzard in October 2023.
Is Microsoft stock a buy, sell or hold?
Microsoft is up roughly 26% on a total return basis (price change plus dividends) over the past 12 months and Wall Street thinks the Dow Jones stock has more room to run.
According to S&P Global Market Intelligence, the average analyst target price for MSFT stock is $502.43, representing implied upside of roughly 20% to current levels. Additionally, the consensus recommendation is Strong Buy.
Financial services firm Argus Research is one of the more bullish outfits on the blue chip stock with a Buy rating and $526 price target.
"Microsoft continues to pursue long-term growth through its artificial intelligence (AI) and cloud investments, and may just hold the premier position in business technology," said Argus Research analyst Joseph Bonner in a July 31 note. "The company is one of just a few with a complete, integrated product set aimed at enterprise efficiency, cloud transformation, collaboration, and business intelligence. It also has a large and loyal customer base, a large cash cushion, and a rock-solid balance sheet."
Argus Research's $526 price target represents implied upside of nearly 25% to current levels.
Related Content
- If You'd Put $1,000 Into Microsoft Stock 20 Years Ago, Here's What You'd Have Today
- Earnings Calendar and Analysis for This Week
- Analysts' Top S&P 500 Stocks to Buy Now
-
Stocks Struggle Ahead of November Jobs Report: Stock Market TodayOracle and Broadcom continued to fall, while market participants looked ahead to Tuesday's jobs report.
-
7 Dr. Seuss Quotes Retirees Should Live ByYou're off to great places! Why Dr. Seuss is the retirement guru you didn't know you needed.
-
Fed's Rate Cuts Could Have Impacts You Might Not AnticipateUnderstanding how lower interest rates could impact your wallet can help you determine the right financial moves to make.
-
Stocks Struggle Ahead of November Jobs Report: Stock Market Today
Oracle and Broadcom continued to fall, while market participants looked ahead to Tuesday's jobs report.
-
Past Performance Is Not Indicative of Your Financial Adviser's ExpertiseMany people find a financial adviser by searching online or asking for referrals from friends or family. This can actually end up costing you big-time.
-
I'm a Financial Planner: If You're Not Doing Roth Conversions, You Need to Read ThisRoth conversions and other Roth strategies can be complex, but don't dismiss these tax planning tools outright. They could really work for you and your heirs.
-
Could Traditional Retirement Expectations Be Killing Us? A Retirement Psychologist Makes the CaseA retirement psychologist makes the case: A fulfilling retirement begins with a blueprint for living, rather than simply the accumulation of a large nest egg.
-
I'm a Financial Adviser: This Is How You Can Adapt to Social Security UncertaintyRather than letting the unknowns make you anxious, focus on building a flexible income strategy that can adapt to possible future Social Security changes.
-
I'm a Financial Planner for Millionaires: Here's How to Give Your Kids Cash Gifts Without Triggering IRS PaperworkMost people can gift large sums without paying tax or filing a return, especially by structuring gifts across two tax years or splitting gifts with a spouse.
-
'Boomer Candy' Investments Might Seem Sweet, But They Can Have a Sour AftertasteProducts such as index annuities, structured notes and buffered ETFs might seem appealing, but sometimes they can rob you of flexibility and trap your capital.
-
AI Stocks Lead Nasdaq's 398-Point Nosedive: Stock Market TodayThe major stock market indexes do not yet reflect the bullish tendencies of sector rotation and broadening participation.
