Microsoft Sinks Under $390 With Nasdaq in Recovery

Microsoft shares fell Monday as some on Wall Street stayed upbeat, but traders focused on whether the company’s $37 billion AI business will expand quickly enough to make all the spending on chips, data centers and models pay off.

Microsoft shares rose in late trading Thursday after a report said the company is getting ready to announce new in-house AI models next week. One of the models is aimed at coding and is designed to boost usage of GitHub Copilot, the developer tool.

Microsoft shares fell late Tuesday morning, down $2.96 to $415.61. That put the company’s market cap near $3.10 trillion. Investors have been concerned about Microsoft’s AI spending this year, but recent comments suggested those worries could be already priced in. Stock is down for the year so far.

Microsoft shares slid Tuesday, with higher U.S. Treasury yields weighing on big tech. The stock was already facing investors’ concerns about what AI spending could mean for costs, even as cloud demand stays strong.

This week, Microsoft Corp. faces a more pointed debate around its stock: is artificial intelligence still its strongest growth engine, or could it end up undermining the Office and Azure lines that helped build its market cap? The latest pressure comes from TCI Fund Management, which slashed its Microsoft stake from 10% of its portfolio at the end of 2025 to just 1% by March’s close. Sir Christopher Hohn, in a note to investors, pointed to uncertainty about Microsoft’s future edge as AI advances rapidly.

Microsoft slid another 2.1% to $358.38 in early New York trading on Friday, pushing the shares nearly 34% under their October 2025 high of $542.07. That's put the company on track for its roughest six-month run since 2009, as investors question whether all that AI outlay—and Microsoft’s heavy OpenAI exposure—will deliver returns soon enough.