Microsoft Sheds $357 Billion as Investors Question AI Costs and Cloud Growth

Redmond, Friday, 30 January 2026.
On Thursday, Microsoft experienced its sharpest sell-off since March 2020, erasing approximately $357 billion in market value. Despite reporting a 17% revenue increase to $81.3 billion and beating earnings estimates, investors punished the tech giant over slowing growth in its Azure cloud division. Crucially, CFO Amy Hood attributed the Azure miss—39% growth versus the 39.4% consensus—to infrastructure capacity constraints rather than a lack of demand. However, Wall Street’s anxiety is mounting over the sheer scale of capital expenditure, which reached $37.5 billion this quarter, and the company’s significant exposure to OpenAI. While analysts at Bernstein remain bullish on the long-term strategy, this massive correction signals a shift in market sentiment, where massive AI spending is now facing intense scrutiny regarding immediate returns on investment.