Microsoft Pushes AI Event and $7B Power Plant as Stock Hits Year Low Despite 123% Revenue Surge

Microsoft is spending this week wooing corporate clients with a dedicated digital event while simultaneously securing its own power supply for a massive data center — yet none of that has been enough to arrest the slide in its share price. The software giant’s stock closed Monday at €321.45, leaving it down roughly 20% since January and within a whisker of its 52-week low.

The centerpiece of the energy push is Project Kilby, a joint venture with oil major Chevron that will build a 2.67-gigawatt natural-gas-fired power plant in West Texas. Tapping the Permian Basin’s abundant gas reserves, the facility is designed to supply electricity exclusively to a new Microsoft data center, bypassing the regional grid entirely. Chevron has until the end of 2026 to give final approval, and the price tag is estimated at around $7 billion. The plant is scheduled to come online in 2028.

That kind of spending is already weighing on the balance sheet. Microsoft poured nearly $31 billion into capital expenditure in the fiscal third quarter, and management has flagged total capex of $190 billion for the full year. The rising cost of graphics processing units is adding further pressure. Investors have grown increasingly uneasy about the sheer scale of the outlays, demanding faster returns on the artificial intelligence bet that is driving the spending.

The quarterly results that preceded those worries should, on paper, have quieted the doubters. Revenue jumped 18% to $82.9 billion in the three months through March 2026, with operating income up 20% and earnings per share rising 23% to $4.27. The Intelligent Cloud segment surged 30% to $34.7 billion, while Azure alone expanded 40%. Microsoft’s AI business has now reached an annualized revenue run rate of $37 billion — a 123% increase from the prior year.

Should investors sell immediately? Or is it worth buying Microsoft?

That disconnect between the growth numbers and the stock’s trajectory is stark. With a relative strength index of 33.2, the shares are close to oversold territory, but analysts caution that no trend reversal signal has flashed yet. The stock also sits about 9% below its 50-day moving average.

This week’s “Cloud & AI Frontier Week,” running from June 22 to 26 and targeting enterprise customers in Europe, the Middle East and Africa, is Microsoft’s latest attempt to convince the market that AI projects are moving from pilot programs to scalable cloud workloads. Company executives are showcasing Azure, Microsoft Fabric, GitHub Copilot and agent-based AI in real-world use cases. But the skepticism runs deeper. A class-action lawsuit filed in Seattle accuses Microsoft of making misleading statements about Copilot user numbers, and failed negotiations with Oracle earlier this year created a temporary server capacity crunch. On top of that, the Xbox division is bracing for a painful restructuring under the “Project Helix” hardware refresh, which will involve layoffs.

To diversify its AI model lineup beyond its deep ties to OpenAI, Microsoft is also evaluating an integration with Chinese startup DeepSeek. The company is betting that a multi-model strategy can help amortize its enormous infrastructure costs more quickly. But for now, the next quarterly earnings report will be the real test — more decisive than any conference week — to prove that margins and capital intensity can hold up under the weight of the AI buildout.