before everyone gets angry, i am not saying microsoft is a bad company. far from it. microsoft will probably continue making tens of billions in profit and be around long after we are all gone. my concern is whether the stock itself becomes dead money.
paypal, adobe, and now arguably uber are all examples of businesses that survived and remained profitable, but investors who bought into the narrative at the wrong valuation didn’t necessarily make money.
microsoft is spending enormous amounts on ai infrastructure and data centers, and the bull case increasingly depends on assumptions about future ai monetization. copilot adoption, enterprise spending, and returns on those investments are still uncertain. that’s speculation, not a guarantee.
meanwhile, google and amazon seem to have multiple engines working simultaneously. google still dominates search and advertising while owning youtube, android, cloud, waymo, and gemini. amazon has aws, advertising, prime, logistics, and retail. both companies have ai exposure without depending as heavily on one product proving itself.
again, microsoft is a phenomenal business. i use its products every day. but great businesses don’t always make great investments. cisco survived the dot-com crash and continued growing, yet investors who bought at the peak waited more than a decade to recover.
am i crazy for thinking microsoft may follow the paypal/adobe path? great company, mediocre stock returns?