AI concerns resurface as Microsoft’s market value suddenly sheds over a trillion, drawing attention.

(Redmond, 30th)
Microsoft was hit by heavy selling on Thursday (29th, local time), wiping out about $357 billion in market value (roughly RM1.4075 trillion). The drop marked the second-largest single-day market-cap loss in U.S. stock market history.

According to overseas reports, the selloff followed Microsoft’s earnings release after the close on Wednesday (28th). Shares fell around 10% by Thursday’s close—its steepest one-day decline since March 2020. The results showed record-high spending tied to artificial intelligence, while growth in the company’s closely watched cloud segment appeared to slow, unsettling investors.

Reports also noted that the largest one-day market-cap loss on record occurred after DeepSeek introduced a lower-cost AI model, prompting a sharp reassessment of the sector and sending Nvidia down roughly $593 billion in a single session. Bloomberg-compiled data suggested Microsoft’s market-value drop was larger than the market caps of more than 90% of S&P 500 constituents combined.

Market observers say the move reflects mounting concerns over whether big tech’s hundreds of billions in AI investments will ultimately deliver meaningful returns. Microsoft’s latest quarterly report showed capital expenditures surged 66% to a record $37.5 billion, while cloud-related growth decelerated from the previous quarter—raising questions about near-term momentum.

The weakness also spread across the sector. Companies including Alphabet and Nvidia saw their market values briefly fall by more than $100 billion during the session. Alphabet later rebounded to finish up 0.7%, while Amazon slipped 0.5%.

Matthew Maley, chief market strategist at Miller Tabak + Co., said investors are increasingly skeptical that Microsoft will generate strong ROI from its massive AI spend, which may force the stock to re-rate toward a level closer to its historical “fair value.”

The report added that Thursday’s decline ranks among Microsoft’s most severe since its 1986 IPO, with larger drops being relatively rare—mostly associated with events like the 1987 crash, the dot-com era, and the 2020 pandemic-driven selloff.