Microsoft’s Share Price Drops Amid Mixed Earnings Report
Microsoft’s share price fell 10% on Thursday, marking its largest one-day drop since March 2020. This decline followed the release of its fiscal second-quarter results for the period ending December 31, 2025, which showed a revenue increase to $81.3 billion—up 17% year-over-year—and diluted earnings per share rising 60% to $5.16. However, investors were disappointed by capital expenditures of $37.5 billion, surpassing analyst expectations, and a slowdown in cloud revenue growth from Azure, which grew 38% but fell short of forecasts.
Despite strong overall revenue, Microsoft’s cloud sales did not meet high expectations from Wall Street. The growth rate of Azure’s revenue slowed, and future sales growth projections of 37% to 38% also disappointed analysts. This mixed performance paints a broader picture of investor sentiment, especially in the highly competitive AI-driven tech market, where companies like Meta Platforms recently outperformed expectations, causing further investor doubt regarding Microsoft’s future outlook.
