Microsoft Stock Plunges on AI Worries
Analysis based on 8 articles · First reported Jun 29, 2026 · Last updated Jun 29, 2026
The significant decline in Microsoft's stock price, driven by concerns over AI spending and its potential to disrupt traditional software, has erased hundreds of billions in market value. This selloff has made Microsoft's valuation the cheapest in a decade, attracting investors like Michael Burry who see a buying opportunity, potentially leading to a rebound if AI investments translate into better earnings.
Microsoft's stock is experiencing its worst month since December 2000, with shares down 17% in June and over $570 billion in market value erased. Investors are concerned about Microsoft's aggressive spending on AI infrastructure and the potential for AI to disrupt demand for traditional software like Microsoft Word and Excel. Despite these worries, some analysts and investors, including Michael Burry, see the current low valuation as a buying opportunity. Microsoft's fiscal third-quarter earnings showed underwhelming growth in its Azure cloud-computing business, and the company forecast $190 billion in capital expenditures through December, further fueling investor caution. However, sales are expected to grow significantly in the coming fiscal years, offering a reason for optimism.
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