Microsoft Hit With Second Downgrade as Melius Warns on AI Risks

Microsoft Corp. shares were downgraded for the second time in less than a week as Wall Street grows increasingly wary about the potential disruption software stocks face from artificial intelligence.

Melius Research cut the stock to hold from buy on Monday, citing concerns about capex spending and Microsoft’s Copilot-branded products which are its main vehicle for selling AI software tools to office workers. The move follows a similar downgrade from Stifel late last week, with analysts warning about the pace of growth in its Azure cloud-computing business.