Microsoft Set to Achieve Record Close After Dramatic Recovery
Microsoft is on pace for its first record close since October 2025, having gained more than 50% from a June low and added roughly $1.5T in market value. The AI-disruption panic that caused a steep fall also affected SAP, which has not recovered.
A Year of Extreme Fluctuations
Microsoft's stock last set a closing high in October 2025. It recently rose as much as 1.8% to $551.13 on Tuesday morning in New York, according to Bloomberg.
June marked the worst period, with the stock falling 17%, erasing nearly $600B as investors questioned AI infrastructure spending. By late July, Microsoft was down 18.7% for the year, and the options market expected a $190B swing on one earnings report.
Turning Point
The earnings report revealed Azure's growth of 43%, surpassing expectations and contributing to Microsoft's best quarter since 1998. Analysts now rate the stock a buy, with an average target of $584.
However, legal issues remain. Shareholders sued Microsoft in June over the stock's collapse, and the case is ongoing. A Michigan police and fire pension fund alleges the company hid Azure growth slowdowns and the need for substantial AI spending.
Global Impact
The AI panic also hit SAP shares, down approximately 35% for the year by late July. SAP has not recovered, trading below its 52-week high worth about €224B.
The situation is not uniform globally. South Korea’s Kospi fell more than 7% intraday on Tuesday, with Samsung down 9%. Broadcom’s CEO noted that many AI investors lack understanding of their investments.