Microsoft’s Worst Month Since 2000: Why Is This Happening?

Microsoft’s Worst Month Since 2000: Why Is This Happening? Piero Cingari Mon, June 29, 2026 at 5:01 AM GMT+7 6 min read MSFT NVDA AAPL GOOGL Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Shares of Microsoft Corp. are down over 20% in June, on pace for the steepest monthly drop since December 2000. Twelve months ago, the Redmond, Washington-based company's market cap hovered around $4 trillion. Today, it's at $2.65 trillion, behind Nvidia Corp., Apple Inc. and Alphabet Inc.. Revenue has grown between 16% and 18% year over year for eight consecutive quarters. Earnings have topped Wall Street estimates every single time and have also been on the rise. A single bad hire can set a startup back years. Here are the 5 hires founders most often misjudge — and why Still Learning the Market? These 50 Must-Know Terms Can Help You Catch Up Fast So why is the stock down more than 35% since the start of 2026? Capex — capital expenditure — is the money a company spends on physical infrastructure. For Microsoft, that means data centers for artificial intelligence. That line of spending, not revenue, is now driving the stock. Capital spending hit $38 billion last quarter. Bank of America estimates Microsoft's 2026 capex will approach $190 billion in 2026. Trending: Avoid the #1 Investing Mistake: How Your 'Safe' Holdings Could Be Costing You Big Time Microsoft is not alone. The five largest hyperscalers — Amazon.com Inc., Microsoft, Alphabet, Meta Platforms Inc. and Oracle Corp. — are projected to spend over $700 billion in 2026. The buildout feeds itself. More data centers strain chip and memory supply. Capex up means margins under pressure, which means free cash flow down. Microsoft's capital spending rose 63% year over year. Free cash flow fell 10%. Less free cash means fewer buybacks and smaller dividends — the two things that reward shareholders. Bank of America frames it starkly. Hyperscaler capex has climbed from 70% of operating cash flow in 2025 to nearly 100% in 2026. Translation: almost no free dollars left for shareholders. There is another side to the trade. Since January, the semiconductor sector — as tracked by the iShares Semiconductor ETF — has surged 94%. The Magnificent Seven, tracked by the Roundhill Magnificent Seven ETF, are down about 6%. Jeff Bezos once said, "Your margin is my opportunity." See Also: Skip the Regrets: The Essential Retirement Tips Experts Wish Everyone Knew Earlier. In 2026, that idea has taken on a new meaning. Every billion that hyperscalers divert away from their own margins is flowing to the companies building the AI stack: memory, semiconductors, cooling systems, optical networking, batteries, power infrastructure, everything required to build AI data centers and train increasingly powerful models. The market is no longer valuing Microsoft for what it earns today. It's valuing the enormous cost of what it must build tomorrow. Is Microsoft investing in the future or sacrificing the present to get there? Right now, investors seem to believe it's the latter. Read Next: Think you're saving enough for your kids? You might be dangerously off — see why Building a resilient portfolio means thinking beyond a single asset or market trend. Economic cycles shift, sectors rise and fall, and no one investment performs well in every environment. That's why many investors look to diversify with platforms that provide access to real estate, fixed-income opportunities, precious metals, and even self-directed retirement accounts. By spreading exposure across multiple asset classes, it becomes easier to manage risk, capture steady returns, and create long-term wealth that isn't tied to the fortunes of just one company or industry. Backed by Jeff Bezos, Arrived Homes makes real estate investing accessible with a low barrier to entry. Investors can buy fractional shares of single-family rentals and vacation homes starting with as little as $100. This allows everyday investors to diversify into real estate, collect rental income, and build long-term wealth without needing to manage properties directly. The rapid adoption of artificial intelligence is creating significant demand for data centers, power, and compute infrastructure. BluSky AI is building modular AI data centers designed to support next-generation AI workloads while aiming to reduce deployment timelines compared to traditional facilities. For investors looking beyond AI software and applications, the company offers exposure to the infrastructure layer that makes artificial intelligence possible. Residential real estate has historically provided investors with income potential and long-term appreciation, but direct ownership can be expensive and time-consuming. ARK7 enables investors to buy fractional shares of rental properties, offering access to potential rental income and real estate exposure without property management responsibilities. By lowering the

Microsoft’s Worst Month Since 2000: Why Is This Happening?

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Microsoft’s Worst Month Since 2000: Why Is This Happening?

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