New York, July 10, 2026, 19:32 (EDT)
Microsoft NASDAQ:MSFT closed Friday almost flat, after an environmental report showed total greenhouse-gas emissions rose 25% in fiscal 2025, mainly on new data centers for AI. cdn-dynmedia-1.microsoft.com Shares ended the day up 0.19% at $385.10, moving in a 2.7% band, and finished 1.38% below last week’s close.
The split is having an impact now. The Nasdaq Composite climbed 1.7% this week and the S&P 500 added 1.2%. Microsoft now trails the Nasdaq by roughly 3.1 percentage points. Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, said the next reporting season looks like “a high-bar quarter with a narrow margin of error.” Reuters
| Asset | Friday move | Weekly move |
|---|---|---|
| Microsoft | up 0.19% | down 1.38% |
| Nasdaq Composite | added 0.29% | rose 1.70% |
| S&P 500 | gained 0.42% | up 1.20% |
Microsoft ended Friday with the lowest trailing P/E in a selected cloud group that includes Alphabet NASDAQ:GOOGL, Amazon.com NASDAQ:AMZN and Oracle NYSE:ORCL. Its 22.9 multiple was 15.9% under the peer median of 27.2. The trailing P/E measures what investors pay for each dollar of profit from the last year.
| Company | Friday close | Friday move | Trailing P/E | Approx. market value |
|---|---|---|---|---|
| Microsoft | $385.10 | up 0.19% | 22.9x | $2.87tn |
| Alphabet | $357.18 | fell 0.49% | 27.2x | $4.33tn |
| Amazon | $245.34 | down 0.70% | 29.3x | $2.67tn |
| Oracle | $140.64 | dropped 2.45% | 25.2x | $410bn |
Microsoft’s electricity use climbed 24%, and its reported emissions from purchased power soared 945%. The surge in emissions was tied largely to a switch in procurement, as Microsoft moved away from renewable-energy certificates—credits linked to current green-power projects—and instead used contracts that aim to add new clean power to grids.
Microsoft said it hit a goal of buying renewable energy equal to all of its annual electricity use and, for the first time, put back more water worldwide than it took out. Source President Brad Smith and sustainability lead Melanie Nakagawa wrote in the report’s foreword that “innovation at this scale must be matched by responsibility at the same scale.” The Official Microsoft Blog
Britain brought Microsoft and three other cloud firms under financial sector supervision, starting July 13. They’ll be subject to resilience tests, routine self-checks and have to report major outages to the Bank of England and two more watchdogs, adding another compliance step on top of existing demands for cloud infrastructure.
Microsoft’s stock dropped almost 23% in the first half, its biggest first-half loss since 2022, as the company laid out a $190 billion spending plan for 2026. Parth Talsania, Equisights Research CEO, said investors want to see “AI monetization is scaling faster than AI-related costs.” Analyst Gil Luria at D.A. Davidson said Microsoft has kept margins steady and grown revenue by holding headcount flat. Reuters
Environmental metrics don’t fully replace financial spending data, and the lower valuation could stick if growth drops off. Azure and other cloud services grew 40% in the March quarter. Microsoft’s AI business hit a $37 billion annual run rate. If those growth numbers fall but infrastructure spending stays up, margins and free cash flow—money left after capex—could get squeezed. Microsoft also cautions that heavy outlays might not deliver the returns it’s hoping for.
Microsoft faces a direct test on July 29, when it reports fiscal fourth-quarter results after the bell. Investors plan to look past the main cloud-growth number and focus on capital spending, operating margins and free cash flow, as they look for evidence the company’s physical expansion—already showing up in its power and emissions data—is generating revenue quickly enough.
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