By Joe Tenebruso
Publication Date: 2026-02-01 17:00:00
Key Points
Investors are questioning Microsoft‘s (NASDAQ: MSFT) artificial intelligence (AI)-driven growth strategy.
Shares of the software giant fell more than 7% this past week, according to data from S&P Global Market Intelligence, following its fiscal 2026 second-quarter earnings release.
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Image source: Getty Images.
Azure’s shortfall
Revenue for Microsoft’s Azure and other cloud services jumped 39% in the quarter ended Dec. 31. That was slightly below Wall Street’s estimates.
During a conference call with analysts, chief financial officer Amy Hood said Azure’s growth would have been over 40% if Microsoft had allocated all its available graphics processing units (GPUs) to its cloud infrastructure business. But it instead chose to use some of those advanced AI chips for its first-party applications, such as Microsoft 365…
