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Microsoft Corporation (MSFT) shares fell to a 52-week low of $349.20 on June 25, following a trend linked to its substantial investments in artificial intelligence (AI) infrastructure. The company has projected capital spending of approximately $190 billion for 2026, focused on data centers, GPUs, and enhancing compute capacity for Azure and Copilot services.
About two-thirds of this spending targets short-lived assets like GPUs and CPUs, affecting near-term profitability with Microsoft Cloud gross margins anticipated at 64% for the upcoming fiscal fourth quarter, down 4% from the previous year. Capital expenditures are expected to surpass $40 billion in Q4, and Microsoft faces capacity constraints through late 2026, reflecting the industry’s significant AI infrastructure expansion alongside competitors Amazon (AMZN) and Alphabet (GOOGL).
Year-to-date, MSFT shares have declined by 22.8%, contrasting with a 24.5% fall in the Zacks Computer – Software industry. The Zacks Consensus Estimate for MSFT’s fiscal 2026 earnings stands at $17.33 per share, indicating a 27.05% growth year-over-year.
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