From Financial Modeling Prep: 2025-01-30 11:23:00

Microsoft Corporation (NASDAQ:MSFT) stock dropped 6% today due to a weaker growth outlook for its Azure cloud division and concerns over low-cost AI models from China. In the fiscal second quarter, Azure revenue rose 31%, slightly missing analyst expectations. CFO projected Azure growth of 31-32% in the third quarter, below analyst estimates.

Microsoft’s AI business revenue hit $13 billion annually, up 175% year-over-year. The company aims to balance financial discipline with investments in cloud and AI infrastructure. Chinese AI startup DeepSeek’s low-cost model poses a threat to competitors like OpenAI. Microsoft’s earnings of $3.23 per share beat estimates, but Azure’s growth concerns linger.

Overall, Microsoft’s stock fell due to a weaker growth outlook for Azure and competitive pressures in the AI space. Despite strong earnings and rapid growth in the AI sector, concerns over Azure’s slowing growth and the emergence of low-cost AI models impacted investor sentiment. The company remains focused on balancing financial discipline with continued investments in cloud and AI infrastructure.



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