THE INTERPRETATIONS OF ISAIAH 7 are legion. In my view only two are plausible.
The setting is clear enough (Isa. 7:1-12). King Ahaz of Judah is terrified of the northern kingdom of Israel forming an alliance with Syria and destroying the southern kingdom. He is therefore unwilling to join them in their pact against the regional superpower, Assyria. In fact, he thinks that by becoming a vassal state of Assyria he might gain some security against the northern kingdom and Syria. The Lord tells Isaiah to take his son Shear-Jashub (which can mean either "a remnant shall return" or "a remnant shall repent") and meet King Ahaz at the end of the aqueduct; apparently the king is inspecting the water supply in anticipation of a long siege. Isaiah has a radical alternative plan to propose from the Lord: trust no one but God, and God will protect Jerusalem and Judah. But under a pretense of piety Ahaz refuses to do this (Isa. 7:12), and therefore judgment must follow: Judah will shortly be attacked and overrun by the very Assyria Ahaz courts for protection (Isa. 7:17-20).
Uncertainty arises over the Immanuel prophecy. On one view, the end of Isaiah 6, which anticipates the rise of a righteous remnant, is tied to the name of Isaiah's son: at least a remnant will repent, and Ahaz is invited to join that remnant. Zion, pictured as a young woman, gives birth to the faithful remnant who will emerge from her sufferings. This "son" is given the name "Immanuel" precisely because God is with us, the faithful remnant. Note the change from "your God" (Isa. 7:11) to "my God" (Isa. 7:13). Before this "son" reaches the age of moral discernment (not more than a few years), the land will have been devastated by Assyria (Isa. 7:17)---for the Lord himself will whistle up the opponents. Even before this (Isa. 7:16a), the lands of Israel and Syria will be laid waste. From the righteous remnant springs the Messiah---which is why Matthew 1:23 can apply Isaiah 7:14 to Jesus.
By the alternative view, Ahaz, despite his pious language (Isa. 7:12), has utterly rejected the Lord's demand that he trust the Lord and abandon any thought of an alliance with Assyria. So the "sign" promised in 7:13-14 is not a sign inviting repentance but a sign confirming divine condemnation (as in, e.g., Ex. 3:12; 1 Sam. 2:34; Isa. 37:30). Judging by the high expectations of verse 11, the sign must be spectacular, not merely a time-lag before a young woman becomes pregnant. Despite arguments to the contrary, the word rendered "virgin" really should be taken that way. In this light, the "Immanuel" prophecy really is messianic. The title, "God with us," anticipates "mighty God" applied to the Davidic Messiah in Isaiah 9:2-7. His coming retrospectively confirms all the judgment that has been pronounced.