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Microsoft (MSFT) just reported strong quarterly financial results. However, MSFT stock experienced one of its sharpest single-day declines in years. Microsoft shares closed about 10% lower following the second-quarter earnings.
A major reason impacting MSFT stock is investor concern over the company’s rapidly rising capital expenditures (CapEx). As demand for artificial intelligence (AI) capabilities within its cloud ecosystem surges, Microsoft is pouring massive investment into the infrastructure needed to support that growth. Spending on GPUs, CPUs, and data center expansion has accelerated faster than the market anticipated.