Dan Loeb‘s Third Point LLC has gradually reduced its stake in tech giant Microsoft Corporation MSFT over the last year, lowering the stake by 3x since the fourth quarter of 2023.

Details: According to recent 13F filings, reflecting his holding as of Dec. 31, 2024, Loeb slashed his stake in the company from 870,000 shares in the third quarter of 2024 to 600,000. That’s a decline of around 31%.

This compares to 1.58 million shares as of the second quarter of 2024, 1.765 million shares as of the first quarter of 2024, and 2.015 million shares as of the fourth quarter of 2023.

• In January, Microsoft reported second-quarter EPS of $3.23, beating the $3.11 consensus estimate, and revenue of $69.6 billion, beating the $68.78 billion analyst consensus estimate.
• The company revealed transformative momentum in its artificial intelligence business, announcing a $13 billion annual AI revenue run rate alongside a major Azure commitment from OpenAI that propelled commercial bookings to unprecedented levels in the second quarter.
• In February, the company has began canceling leases for significant data center capacity in the U.S., possibly signifying AI computing overcapacity.
• CEO Satya Nadella unveiled Majorana 1, a quantum chip powered by an entirely new state of matter—topoconductorsn and aims to scale to 1 million qubits for industrial-scale problem-solving.
• Microsoft has pledged to invest an additional $700 million in Poland. The investment aims to strengthen the country's cybersecurity infrastructure in partnership with the Polish armed forces.
• In March, the company launched Dragon Copilot, an AI assistant designed to streamline clinical workflows by combining voice dictation, ambient listening, and generative AI.

Analysts Views

• Morgan Stanley analyst Keith Weiss lowered the price forecast from $540 to $530, stating that while ”Azure was disappointing.” Strength in the GenAI ramp vs moderating capex growth should support accelerating FY26 FCF growth.
• DA Davidson determined that demand for its AI services ”remains heightened.” However, core Azure services continue to decelerate. Management is retracting its previous guidance of a ”second-half reacceleration of Azure revenue.”
• Raymond James analyst says that overall, this quarter will ”go down as a disappointment.” That’s not due to any revisions on the scale of the AI opportunity but more due to the timing of capitalization on these trends.

In the past year, Microsoft has declined around 3.5%, underperforming the iShares U.S. Technology ETF IYW, which gained about 43.1% over the same time frame.

Also, the company significantly lagged compared to its closest peers Oracle Corporation ORCL, which rose roughly 46.0%, and ServiceNow, Inc. NOW, which grew approximately 22.99% in the last one year.

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