New York, February 1, 2026, 09:42 ET — The market has closed.
Microsoft shares closed Friday at $430.29, slipping 0.7%, and head into the new week still rattled by Thursday’s sharp decline of nearly 10%. (Investing)
The stock’s shake-up signals more than just trouble for one company. A packed earnings calendar, featuring megacaps, will challenge market mood following Microsoft’s misstep that dragged down indexes. “The onus is going to be on them to deliver,” said Jim Baird, chief investment officer at Plante Moran Financial Advisors. (Reuters)
Investors face a heavy slate of U.S. data this week, including Friday’s January payrolls report and surveys on business activity and job openings. However, Kiplinger cautions the calendar could shift, since some releases may be delayed due to the ongoing government shutdown. (Kiplinger)
Microsoft’s recent quarterly numbers looked solid at first glance: revenue climbed 17% to $81.3 billion for the quarter ending Dec. 31. Microsoft Cloud revenue surged 26% to $51.5 billion, with Azure and other cloud services jumping 39%. The company also reported its commercial remaining performance obligation — sales contracted but not yet recognized as revenue — more than doubled, soaring 110% to $625 billion. “We are only at the beginning phases of AI diffusion,” CEO Satya Nadella remarked. (Microsoft)
A regulatory filing revealed Microsoft released its earnings in an 8-K dated Jan. 28, attaching the press release as an exhibit. (SEC)
What unsettled traders was the spending figure. Microsoft reported capital expenditures—covering data centers and equipment—hit $37.5 billion this quarter, a nearly 66% jump from last year. Executives forecast Azure revenue growth of 37% to 38% for the current quarter. CFO Amy Hood noted capex should be “slightly lower than in the just-completed quarter” but cautioned that rising memory-chip costs will pressure cloud margins over time. Nadella revealed 15 million annual users for the $30-a-month M365 Copilot assistant. Meanwhile, portfolio manager Eric Clark flagged costs climbing faster than revenue. (Reuters)
Late last week brought a new data point on demand for Microsoft’s cloud services. AI startup Perplexity inked a $750 million, three-year deal for Azure, Bloomberg News reported. A Microsoft spokesperson confirmed to Reuters that “Perplexity has chosen Microsoft Foundry as its primary AI platform for model sourcing.” (Reuters)
The selloff has brought a fresh concern into focus: the cost of AI infrastructure might hit before the benefits do. Microsoft’s stock dropped 10% on Thursday, erasing almost $360 billion in market value. Jefferies analyst Brent Thill pointed to the company’s backlog details, saying they “underscored worries” about the concentration risks linked to OpenAI, according to Investopedia.
Macro noise has returned to the spotlight. A partial U.S. government shutdown kicked in early Saturday when funding expired for certain agencies. The House is set to vote Monday on a bill that might end the shutdown, Barron’s reported. (Barron’s)
The upcoming week is packed: Walt Disney kicks off earnings Monday, followed by Advanced Micro Devices on Tuesday. Alphabet reports Wednesday, with Amazon closing out the week on Thursday, per Kiplinger’s earnings calendar. Then on Friday, Feb. 6, the U.S. jobs report drops at 8:30 a.m. ET — a key moment for rate expectations and the valuations of big tech. (Kiplinger)
