Stocks

MSFT Stock: Microsoft’s $22b government contract

Tech stocks like Microsoft (MSFT) are rising quickly this morning as the bell opened. Investment bankers expect around 10% to 20% increase in tech stocks.

However, MSFT stock could go higher. Last week the company announced that it has won a government contract for smart augmented reality goggles. provide 120,000 augmented-reality (AR) headsets for its troops over the next 10 years.

The MSFT deal

The contract is worth $22 billion with Microsoft selling the government 120,000 headsets based on HoloLens 2 hardware. This deal seems good for the first 5 years meaning some portion of the $22 billion may be guaranteed. In addition, government contracts can carry complications as you can see with the Department of Defense’s $10 billion JEDI cloud contract is held up in court by Amazon.

While the $22 billion contract sounds impressive, these deals won’t move the needle significantly for Microsoft but it could be a stepping stone to help build momentum for mainstream AR adoption in other industries like health, construction, or manufacturing.