Securities Fraud Class Action Filed Against Microsoft Over Copilot Issues and 10% Stock Drop
MSFT sits 37% above its 52-week low of $349.2.
Summary
A securities fraud class action has been filed against Microsoft, alleging the company misled investors about the functionality and adoption of its AI chatbot Copilot, which drove Azure revenue. The lawsuit follows a 10% stock drop on January 28, 2026, after Microsoft disclosed disappointing Q2 results and revealed only 15 million Copilot premium customers, well below analyst estimates. The complaint claims Copilot suffered from severe issues that caused declining user adoption, contradicting prior positive statements. This legal action adds a new layer of risk for Microsoft, which has already seen its stock decline over 24% year-to-date amid concerns about massive AI capex and growth sustainability. The lead plaintiff deadline is August 11, 2026, and the case is pending in the Western District of Washington.
At the time of this announcement, MSFT was trading at $479.80 on NASDAQ in the Technology sector, with a market capitalization of approximately $3.6T. The 52-week trading range was $349.20 to $553.72. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: PR Newswire.