tech
February 1, 2026
Microsoft suffers $357 billion rout over AI spending fears
Microsoft shares fell 10% this week, marking their largest decline since March 2020
TL;DR
- Microsoft shares fell 10% this week, the largest decline in over five years.
- The drop is linked to record spending on artificial intelligence and slowing growth in its cloud unit.
- The company reported a 66% jump in capital spending to a record $37.5 billion in the latest quarter.
- Investor skepticism is growing regarding the return on Big Tech's AI investments.
- The selloff affected other major tech companies, including Alphabet and Nvidia.
- Microsoft's profit was boosted by OpenAI investments, increasing reliance on the partnership.
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