Seeing Microsoft's stock price plummet by 12% on January 29th really took me by surprise. Losing $430 billion in a single day is the biggest drop since the pandemic. Even though earnings targets should have been exceeded, I wonder why this happened.

After looking into it, it seems that the main reason is the slowdown in Azure's growth. Even a 39% increase didn't meet market expectations. Additionally, capital expenditures have ballooned to $37.5 billion. They're pouring money into AI infrastructure, but profit margins have dropped from 72% to 67%. Investors are probably no longer satisfied with just the word "AI."

Another concern is the dependence on OpenAI. About 45% of Microsoft's $62.5 billion in commercial backlog is tied to OpenAI—doesn't that seem too concentrated? The market has probably started to notice this too.

The wave of Microsoft's stock decline is affecting the entire tech sector. High-beta assets are also falling together, and crypto-related stocks are under pressure. During times like this, it's crucial to monitor global risk appetite; otherwise, you might misjudge the situation.

The key going forward is whether Azure can overcome supply constraints. If it can, we'll see whether this drop is just a temporary correction or the start of a major reevaluation of tech companies. The reasons behind Microsoft's stock decline are complex, but ultimately, concerns about whether massive investments in AI will translate into profits seem to have driven buyers away.