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Microsoft Heads for Worst Month Since the Dot-Com Crash as AI Fears Wipe Out $570 Billion
Microsoft was one of the biggest winners of the AI boom. AI means artificial intelligence — computer programs that can learn and do tasks that usually need a human. Now Microsoft has become one of the boom’s biggest worries.
Its stock has dropped about 17% in June. A stock is a small piece of a company that people can buy and own. This is Microsoft’s worst month since the dot-com crash of 2000.
The company’s market value has fallen by more than $570 billion. Market value is the total worth of all of a company’s shares added together. The strange part is this: the very thing that lifted Microsoft up, AI, is now what is scaring investors. Investors are people who put money into a company by buying its shares.
What is happening to the stock
This news comes from Bloomberg and was reported by Financial Express. On June 29, Microsoft shares were trading at about $370.89. That is down about 17% for the month.
If the month ends near that price, it will be Microsoft’s worst month since December 2000. Back then, the shares fell 24.4%. That was during the “dot-com crash”. In that crash, the stocks of many internet companies fell hard after years of big hype.
The selloff has wiped out more than $570 billion in market value. A selloff is when lots of investors sell their shares at the same time. The stock recently fell to its lowest closing price since 2023. After that, it went up a little.
| Key fact | Detail (per Bloomberg via Financial Express) |
|---|---|
| June stock drop | About 17% |
| Market value lost | More than $570 billion |
| Share price (June 29) | About $370.89 |
| Worst month since | December 2000 (dot-com era), when shares fell 24.4% |
| Recent low | Lowest close since 2023 |
| Core worry | Heavy AI spending plus fear AI could disrupt Microsoft’s own products |
Why investors are nervous on two fronts
Investors are worried about two things at once. First, Microsoft is spending huge amounts of money to build AI. It is paying for new data centres, chips, and computing power. Data centres are big buildings full of computers that store and run online services.
Second, some people worry that AI could one day replace Microsoft’s own best-selling products, like Word and Excel. This could happen if smart AI tools learn to do the same work.
“Microsoft is getting hit on two sides with worries about both AI spending and AI disruption,” said Jack Ablin. He is the chief investment strategist at Cresset Wealth Advisors, a firm that owns the stock. He was speaking to Reuters.
“While it looks like a pretty good deal with the valuation so low, I’m getting the sense that investors are shooting first and asking questions later,” he said. Valuation means how much a company is judged to be worth. He added that the heavy spending is a real concern. Many companies borrow money from the bond market to pay for building AI. The bond market is a place where companies borrow money from investors and promise to pay it back later with interest.
Is this an AI bubble warning?
The link to the dot-com crash is not by chance. Back then, investors put lots of money into internet companies. Then they panicked when the profits did not come fast enough.
Today people ask a similar question. Will the huge spending on AI by big tech companies pay off? Or did people expect too much, too soon? Microsoft’s drop is one of the clearest signs yet that Wall Street is starting to ask hard questions. Wall Street is the part of New York where big banks and investors trade stocks; people use the name to mean the whole U.S. stock market. This worry about AI’s costs and returns also shows up in new bets, like new AI coding startups raising big rounds.
Why it matters (especially for India and founders)
Microsoft is a bellwether. A bellwether is a company so big that its ups and downs often hint at where the whole market is going. A sharp fall in its stock can spread to stock markets around the world. That includes Indian markets and the many Indian startups and IT firms that use Microsoft’s cloud and AI tools.
For founders, the lesson is about discipline. Spending on AI is fine. But investors now want to see a clear way the money will come back as profit, not just bigger bills. The time of “spend now, explain later” may be ending.
FAQ
How much value has Microsoft lost? More than $570 billion in market value. The stock is down about 17% in June.
Why is AI the worry if it helped Microsoft? Investors fear two things. One is the huge cost of AI spending. The other is the chance that AI could replace Microsoft’s own products, like Word and Excel.
Is this as bad as the dot-com crash? It would be Microsoft’s worst month since December 2000. But the stock has not fallen as far as the 24.4% drop seen back then.
The takeaway
Microsoft is heading for its worst month since the dot-com crash. About $570 billion in value is gone. Investors are worried about both AI spending and AI disruption. This is a loud signal that Wall Street now wants proof that the AI boom will really pay off.
Source: Financial Express (citing Bloomberg).
