Key Updates on Microsoft and Amazon
As of March 2026, Microsoft has seen a significant decline in its stock performance, down 23.4% year to date, attributed to fears surrounding artificial intelligence’s (AI) impact on established software markets. Microsoft reported $37.5 billion in quarterly capital expenditures, with two-thirds allocated for short-lived AI infrastructure assets, resulting in free cash flow dropping to $5.9 billion.
Meanwhile, Amazon is planning a substantial investment of $200 billion in AI infrastructure for 2026, as the company aims to strengthen its AWS divisions. Despite a 10.3% stock drop since the beginning of the year and an overall 18.5% decrease over five months, Amazon continues to prioritize long-term growth following its historical trend of overcoming skepticism from investors.
Both companies reflect broader market concerns around AI expenditures, with analysts suggesting these strategies could lead to future growth despite the current pressures. The combined market cap of the “Magnificent Seven,” which includes Microsoft and Amazon, is approximately $21.8 trillion, making them significant players in the S&P 500.
