Qualcomm Deal and EU 'Gatekeeper' Threat Pull Microsoft Stock in Opposite Directions

Microsoft’s stock staged a dramatic rebound on Friday — but the week that preceded it was one of the worst in recent memory for the tech giant. The shares climbed 5.71% to close at €327.90, making it the best performer in the Dow Jones even as the broader market slipped. Yet the rally came after the stock touched a 52-week low of €307.10 just two days earlier, and the company faces gathering storms on both sides of the Atlantic.

The most immediate threat comes from Brussels. European Union competition authorities are preparing to formally classify Microsoft’s Azure cloud platform as a “gatekeeper” under the Digital Markets Act, which would impose strict data-interoperability requirements. Non-compliance could trigger fines of up to 10% of global annual revenue. That news, coupled with a class-action lawsuit filed by institutional investors on June 24 alleging the company misled the market about the performance of its AI assistant Copilot, sent the stock to that fresh low on Thursday.

The Friday rebound was fueled by an entirely different narrative. Chipmaker Qualcomm announced that both Microsoft and Meta Platforms will adopt its new artificial-intelligence chips, designed to compete in the data-center market long dominated by Nvidia. Microsoft’s systems will use Qualcomm’s “High Bandwidth Compute” architecture, which relies on cheaper memory from the smartphone and laptop ecosystem rather than the expensive high-bandwidth memory typical of Nvidia-powered servers. The move gives Microsoft greater infrastructure flexibility and potentially lower cost per AI inference. Qualcomm also disclosed its acquisition of AI-software startup Modular for roughly $4 billion in stock, strengthening the software layer for generative and agentic AI and cementing its position as a more credible partner for hyperscale cloud operators.

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

Investors also rotated into established software names on Friday, pulling capital out of high-priced hardware stocks. That sector rotation added momentum to Microsoft’s bounce. Still, the gain only scratches the surface of deeper damage. The stock is down 1.23% on the week, nearly 19% from the start of 2025, and has lost roughly 23% over the past twelve months.

Technical indicators underscore the fragility of the recovery. Friday’s close at €327.90 sits well below the 50-day moving average of €352.96 and far beneath the 200-day moving average of €383.98 — both levels now acting as resistance. The 14-day relative strength index of 43 suggests neither overheating nor a confirmed trend reversal. Until the stock reclaims the 50-day line, the bounce remains what it looks like: a stabilization attempt after a selloff, not a confirmed shift in direction.

Meanwhile, Microsoft’s management continues to pour capital into AI infrastructure. Its first data center in Mount Pleasant, Wisconsin came online in April, with planned investment of $4.7 billion through 2028. A new campus in Texas will add 2 gigawatts of capacity. On the software side, the company is taking an aggressive approach to enterprise adoption: by mid-July, Copilot will be automatically installed on eligible corporate PCs, though Europe is excluded due to stricter regulations. Microsoft also released its 2026 AI education report, which found that 92% of students and education officials and 88% of teachers have already used AI for school-related tasks — a sign of how broadly the company is pushing its AI narrative beyond cloud and corporate customers.

All eyes now turn to July 28, when Microsoft reports fiscal fourth-quarter earnings. The numbers will be the first real test of whether the billions poured into AI infrastructure and partnerships like the one with Qualcomm can translate into sustainable margin expansion — or whether the regulatory and legal headwinds will prove the heavier hand.

Ad

Microsoft Stock: New Analysis - 27 June

Fresh Microsoft information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

Read our updated Microsoft analysis...

en | US5949181045 | QUALCOMM | boerse | 69639528 |