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Overall, Microsoft’s revenue rose 17% year over 12 months, putting this quarter among the many finest that Microsoft has delivered over the past decade. Total, it is down almost 30% from its all-time highs, one thing that not often occurs with a stalwart like Microsoft. The stock has misplaced 20% of its value in 2026 and is the worst-performing “Magnificent Seven” stock by far. Microsoft (MSFT 1.69%) stock has been an outsized loser in 2026. Bug fixes, stability improvements, repairs to space-time continuum.
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However, I don’t suppose Microsoft must be valued as a market-average stock, either. The S&P 500 trades for twenty-four.1 times earnings now, and there is some debate about whether Microsoft deserved a 50% premium to the market. Microsoft spent the better part of the past few years trading in the mid-30s times earnings range, which may be very costly. So, why is Microsoft’s stock down if it’s doing properly and sustaining the standing quo?