Sharp Price Decline Driven by Earnings & AI Spending Concerns Microsoft's stock has dropped approximately 23.5% from its recent high, with a severe -9.99% single-day drop on January 29th, 2026, following its Q2 FY2026 earnings report. The core issue was not a miss on revenue or EPS (both beat estimates) but investor frustration over the pace of AI monetization. CFO Amy Hood indicated the company prioritized internal AI development over maximizing near-term cloud revenue growth, leading to concerns about the return on massive capital expenditures. This resulted in the stock's worst post-earnings drop in nearly 13 years, erasing about $357 billion in market cap.
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