Microsoft (MSFT) Project Kilby Agreement Highlights Data Center Power Demand, Stifel Says

Microsoft Corporation (NASDAQ:MSFT) is one of the 15 AI Stocks Analysts Are Watching: Microsoft, Nvidia, and More.

On June 23, Stifel analyst Brad Reback reiterated a Hold rating on the stock with a $415.00 price target. The rating affirmation follows Microsoft’s recent announcement of a 20-year power agreement with Chevron, Project Kilby.

While this long term power agreement with Chevron is a reflection of the growing need for electricity to support datacenter expansion, the firm has cautioned that the project remains years away from delivering power.

In the investor note, the firm noted how the project remains in the pre-construction phase and will remain that way until the Final Investment Decision is reached, sometime around year-end 2026.

As of now, the plan remains constrained to planning, environmental review, and permitting, with Chevron reportedly reserving manufacturing slots for major turbine equipment well in advance (according to a company press release in January 2025).

Northfoto / Shutterstock.com

While Project Kilby is anticipated to provide first power delivery in year 2028, the investor firm cautioned that this should be considered the earliest possible timeline instead of a firm delivery date, or even longer. This, it added, depends on the regulatory environment and real economic value added.

Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops and sells a wide range of software, cloud services, devices, and business solutions, serving both individual users and enterprise customers worldwide.

READ NEXT: 33 Stocks That Should Double in 3 Years and Cathie Wood 2026 Portfolio: 10 Best Stocks to Buy. 

Disclosure: None. Follow Insider Monkey on Google News.