New York, Feb 22, 2026, 10:07 (ET) — Market closed
- Microsoft shares last traded at $397.23 on Friday, down about 0.3%.
- Microsoft said gaming head Phil Spencer will retire; insider Asha Sharma will take over the unit.
- Traders are watching Nvidia results on Wednesday for clues on AI demand and big-tech spending.
Microsoft (MSFT.O) goes into the new week with investors staring at the cost of artificial intelligence after Microsoft-backed OpenAI is targeting roughly $600 billion in total compute spending through 2030 — the chips and data-center capacity used to train and run AI models — as it lays groundwork for an IPO that could value it at up to $1 trillion, a source familiar with the matter told Reuters. The source said OpenAI logged $13 billion in 2025 revenue on $8 billion of expenses. Microsoft shares ended Friday down 0.3% at $397.23. (Reuters)
The stock has been trading on a blunt question: how long does Microsoft have to keep spending heavily to stay ahead in AI, and when does the payoff show up in margins and growth.
Investors get Nvidia results on Wednesday, Feb. 25, and remarks from CEO Jensen Huang, which traders use as a read-through on data-center spending by the big cloud companies. Markets are also digesting Friday’s U.S. Supreme Court ruling striking down President Donald Trump’s tariffs and looking to his State of the Union on Tuesday, Feb. 24, for what comes next on trade policy and refunds. Marta Norton, chief investment strategist at Empower, said “it’s hard for Nvidia to surprise when everyone expects it to surprise.” (Reuters)
Microsoft said on Friday gaming head Phil Spencer is retiring after 38 years, staying on as an adviser through the summer, and named insider Asha Sharma to run the division. The unit has been dealing with tariff-driven cost pressures and uncertain consumer spending, and Microsoft reported a roughly 9.5% drop in gaming revenue in the December quarter, after its $69 billion Activision Blizzard deal in 2023, while Sony’s PlayStation remains the main console rival. D.A. Davidson analyst Gil Luria said “As AI becomes a bigger element in game development, Microsoft needs a new generation of leaders to manage through this transition.” (Reuters)
For Microsoft, the OpenAI numbers land in the same place: the scale of the AI buildout, and who pays for it up front. Investors have been quick to punish any sign that spending runs ahead of revenue in cloud and AI software.
That tension has been hanging over the stock since its January results. Microsoft said it spent a record amount on artificial intelligence in the quarter and that Azure revenue grew 39% in the October-December period, just above a Visible Alpha consensus estimate. Eric Clark, portfolio manager of the LOGO ETF, flagged costs, saying “revenues are up 17% and the cost of revenues are up 19%,” and the shares fell 6.5% in after-hours trading after the report. (Reuters)
Investors now want to see whether Microsoft can keep cloud growth steady while funding data-center buildouts, and whether it can sell more AI tools without giving too much away on price.
But the downside case stays close: a weaker-than-expected Nvidia forecast, or any fresh twist on tariffs, could hit the whole AI complex again and drag MSFT with it. In that setup, Microsoft’s own spending plans become a bigger target.
With markets reopening Monday, the first test is whether the late-Friday headlines drive fresh selling or bargain hunting. After that, attention shifts to Nvidia on Feb. 25 and to enterprise software earnings and policy signals in Washington.
