Article ID: 6ae55bb1e94d08c8c331db310b1ee072483e0321b4a3b78ff69df628a3519632
Source ID: secondary:businessinsurance.com
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URL: https://www.businessinsurance.com/microsoft-sued-by-shareholders-over-expenses-cloud-business-ai/
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Microsoft sued by shareholders over expenses, cloud business, AI - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Microsoft sued by shareholders over expenses, cloud business, AI D&O Jun 16, 2026 (Reuters) – Microsoft has been sued by shareholders who accused the company of defrauding them and inflating its stock price by failing to disclose slowing growth in its Azure cloud business and the need to spend billions of dollars on artificial intelligence infrastructure. The proposed class action led by a Michigan pension fund was filed in Seattle federal court on Friday, after Microsoft shares fell 10% on Jan. 29 in response to its quarterly earnings report a day earlier. About $357 billion of market value was erased, and Microsoft’s stock suffered its biggest one-day decline in nearly six years. Microsoft said on Monday it believes the claims are “without merit,” adding, “Microsoft stands by the integrity of its public statements and will vigorously defend itself in court.” For its fiscal second quarter ending in December, Microsoft reported 39% revenue growth in its Azure and other cloud businesses, meeting analyst forecasts but down from 40% in the prior quarter, and projected 37% to 38% growth in the first three months of 2026. Microsoft also reported $37.5 billion of capital spending in its second quarter, up nearly 66% from a year earlier and above the $34.3 billion that analysts projected. The lawsuit said Microsoft attributed the slowing Azure growth and higher spending to capacity constraints as it diverted resources to AI-related research and development and to its Copilot chatbot, whose rivals include Google’s Gemini and OpenAI’s ChatGPT. Microsoft, based in Redmond, Washington, is a major investor in OpenAI. The lawsuit is led by the City of St. Clair Shores Police and Fire Retirement System in Michigan. Defendants include several Microsoft officials, including CEO Satya Nadella and Chief Financial Officer Amy Hood. The proposed class period runs from May 1, 2025, to January 28, 2026. It is common for shareholders to sue companies for alleged securities fraud after unexpected declines in stock prices. 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