Microsoft outperformed broader indices in May, driven by strong earnings and AI sector momentum despite a 14% year-to-date decline.
Microsoft shares climbed 10.4% in May, outpacing the S&P 500’s 5.2% gain and the Nasdaq Composite’s 8.4% rise. The rally followed a robust April quarterly report, where the company posted adjusted earnings per share of $4.27 on revenue of $82.89 billion, exceeding analyst estimates of $4.06 and $81.39 billion, respectively.
Despite the positive results, Microsoft’s revenue guidance for the next period, ranging from $86.7 billion to $87.8 billion, fell short of the $87.53 billion consensus. The stock faced initial sell-offs post-earnings but rebounded as AI-driven market momentum lifted tech valuations.
Year-to-date, Microsoft shares remain down roughly 14%, reflecting broader concerns about AI-related disruption risks and macroeconomic pressures on the tech sector.