Microsoft shareholders sue tech giant ‘hiding’ slow cloud growth
Shareholders have filed a lawsuit alleging Microsoft inflated its stock price by hiding Azure's slowdown while investing heavily in AI.Summary
Microsoft is facing a proposed class-action lawsuit filed by a Michigan-based pension fund and other shareholders in a Seattle federal court. The suit alleges that the company inflated its stock price by concealing a slowdown in its Azure cloud business while aggressively investing billions in artificial intelligence infrastructure. The complaint claims Microsoft overhyped its AI advancements and Copilot to drive investor optimism while downplaying the financial risks of its massive AI investments and partnerships with OpenAI. The legal action follows a significant market crash on January 29, when Microsoft shares plummeted 10% in a single day, erasing $357 billion in market value. The lawsuit names top executives including CEO Satya Nadella and CFO Amy Hood as defendants. The investors argue that Microsoft misled the public about internal bottlenecks and capacity constraints, projecting that Azure growth would slow to 37% or 38% for the first three months of 2026. The legal action aims to represent anyone who purchased Microsoft stock between May 1, 2025, and January 28, 2026.
(Source：Times of India)