Microsoft's stock has staged an unusually strong rebound this week, raising the stakes for its earnings report later in April.

Shares of Microsoft $(MSFT)$ have risen 13.3% so far this week, making for their best four-day stretch since 2020, according to Dow Jones Market Data. The stock closed up 2% on Thursday.

Susquehanna analyst Christopher Jacobson told MarketWatch that Microsoft's move this week has come as part of a broader rally among beaten-down software stocks, though it also stands out as an extreme "rebound-type play."

"These moves happen, but they're expected to happen very infrequently."

He noted that Microsoft's stock is on pace for a roughly 12.5% weekly move.

"Based on what the options were pricing in heading into the week, that equates to nearly a three standard-deviation move, which should only happen about one out of every hundred weeks."

Even with the recent price action, shares of Microsoft have fallen roughly 11% so far this year, as investors have grown apprehensive of Microsoft's ability to compete in the age of AI.

"Some are likely expecting further catch-up," Jacobson said.

TD Cowen analyst Derrick Wood, though, believes further positive momentum may be harder to come by, at least in the near term. He predicts the stock could be "range-bound" until the company is able to accelerate its Azure growth or further drive Copilot adoption.

That's a process that could take multiple quarters. Azure may show limited upside in the coming earnings report, scheduled for April 29, given that Microsoft is allocating some of its capacity towards things like internal research and development instead of going all in on the cloud, Wood noted.

But there could be some bright spots before that, including adoption of Copilot Cowork and Microsoft 365 E7, the company's AI-driven enterprise subscription platform due to be rolled out next month, according to Wood. Microsoft is now focusing on selling Copilot - its AI-powered assistant - as opposed to offering it for free, and that should be a focus in its earnings report at the end of the month.

Judson Althoff, chief executive officer of Microsoft's commercial business, recently said that the company has hit "audacious goals" for its Copilot sales in the March quarter, according to a Bloomberg report.