Microsoft's shares have been down sharply this year, with a 23% drop in Q4 and trailing the S&P 500. Goldman Sachs has defended Microsoft's AI story, stating that the company's value is still intact and that the risks associated with AI are already more than priced in. The bank has reiterated a buy rating on Microsoft and set a $600 stock price target, suggesting a 61% upside from where the stock closed before the note went out. Goldman's call comes as Microsoft shares are down about 23% year to date and have posted their worst quarterly performance since the 2008 financial crisis. Goldman believes that Microsoft’s AI capabilities are already overpriced in and that its Copilot adoption, Azure margins, and the size of Microsoft‘s AI data center bill are now the main concerns.