Microsoft Stock Slides 20% YTD as $190B Capex Outpaces AI Gains

On July 13, 2026, investors focused on Microsoft’s surging AI infrastructure costs despite strong fundamentals. Shares have fallen about 20% year-to-date even as the company’s AI business reached a $37 billion annual run rate, up 123% YoY, and Azure grew 40%. Q3 capex hit $30.88 billion with full-year 2026 guidance at $190 billion, pressuring free cash flow. A $10,000 investment at Nadella’s 2014 start is now worth $128,242, while commercial remaining performance obligations stand at $627 billion. Analysts maintain a bullish $560 consensus target implying 46% upside, but markets await clearer returns on the heavy spending.