Microsoft Corp. shares are on track for the steepest monthly decline since the dot‑com bust, a slide that threatens to erase roughly $570 billion in market value for investors. Traders cite lingering doubts about the software titan’s ability to translate its artificial‑intelligence push into sustainable earnings. The sell‑off intensifies scrutiny of the company’s growth narrative after a year of lofty AI hype for investors.

Investors point to recent earnings misses and weaker cloud bookings as warning signs that the AI‑driven optimism may be overstated. Analysts note that while Microsoft’s AI integrations have sparked headline‑making partnerships, the firm still relies heavily on legacy software revenue streams vulnerable to competitive pressure. The market’s reaction suggests a demand for clearer guidance on monetising new technology in the near term.

With the S&P 500 tech segment already under pressure, Microsoft’s slide could drag broader indices lower, prompting fund managers to rebalance exposure to high‑growth names. The episode underscores how quickly AI enthusiasm can turn into valuation volatility when earnings fail to match expectations. Microsoft now faces a decisive quarter to prove that its AI bets can sustain shareholder confidence in the market.