By Jordan Novet
Publication Date: 2026-03-31 20:19:00
Microsoft CEO Satya Nadella speaks at the Microsoft AI Tour event in Munich, Germany, on Feb. 25, 2026.
Sven Hoppe | Picture Alliance | Getty Images
Microsoft just closed out its worst quarter on Wall Street since the 2008 financial crisis, as investors soured on the software giant’s prospects in artificial intelligence.
The company’s stock plunged 23% in the first quarter, a steeper drop than any of its tech peers or the Nasdaq, which fell 7% in the period. Microsoft bounced back a bit on Tuesday, alongside a broader market rally, with shares of the company gaining 3.3%, the biggest jump since July.
While Microsoft remains dominant in workplace productivity software and through its Windows operating system, the company is facing twin pressures to grow efficiently in AI while also building out its cloud AI infrastructure to support soaring demand.
Oil prices are surging because of the Iran war, potentially driving up costs for building and running data centers. And on the product…
