Options Market Statistics: Microsoft's Stock Rides AI Elation Toward First Record Close in Two Months

Microsoft's stock headed for its first record close in two months Tuesday, a momentum related to the company's latest artificial-intelligence announcements pushed the share price higher.

The technology powerhouse is in the midst of its Build developer conference, featuring announcements around products and software. Microsoft on Monday debuted new personal computers that integrate the company's Copilot artificial-intelligence assistant. Tuesday's announcements highlighted ways AI software can augment the working experience.

Shares of cybersecurity provider Palo Alto Networks fell after the company reported first-quarter results, with remaining performance obligations (RPO - leading revenue indicator) falling slightly short of Wall Street's expectations. Also, billing growth decelerated (+3%) year on year. Management doesn't consider billings to be a true indicator of the strength of the business due to a mix-shift in customers' payment terms towards annual billing plans.

The company added, "We saw a greater volume of large deals with some of these customers opting for deferred payments over the term of their purchase instead of paying upfront as they grapple with the higher cost of money." This weakness is also consistent with the company's platformization strategy (aimed at driving consolidation while providing customers a period of the contract for free as part of their commitment), which is expected to pose a headwind to billings over a 12- to 18-month period. As a quick recap, the company updated during the previous earnings call that "a typical customer entering into a platformization transaction will not pay us for our technology for a period of time." These puts and takes might be tough for investors to track and digest.