How Low Can Microsoft Stock Go?

25 February 2026, Bavaria, Munich: The Microsoft logo and lettering can be seen on the Microsoft Deutschland GmbH headquarters building in Parkstadt Schwabing in Munich (Bavaria, Germany). Microsoft Corporation is the world’s largest software manufacturer and one of the largest companies in the world. (symbol image, symbol photo, illustration, symbolic photo, illustrative photo, theme image, general image, theme photo) Photo: Matthias Balk/dpa (Photo by Matthias Balk/picture alliance via Getty Images)

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Microsoft (MSFT) stock have plunged by 16.2% over the course of 21 trading days. This recent decline is attributed to worries about a slowdown in Azure’s growth and escalating AI investments, in addition to its significant connections with OpenAI. However, steep declines like this often prompt a more challenging question: is this weakness short-lived, or does it indicate more profound issues in the narrative?

Before evaluating its downturn resilience, let’s examine Microsoft’s current position.

• Size: Microsoft is a $3.0 Trillion company generating $305 Billion in revenue, currently trading at $401.72.
• Fundamentals: Revenue growth over the last 12 months is 16.7%, with an operating margin of 46.7%.
• Liquidity: The company has a Debt to Equity ratio of 0.02 and a Cash to Assets ratio of 0.13.
• Valuation: Microsoft stock is presently trading at a P/E multiple of 25.0 and a P/EBIT multiple of 20.0.

These metrics indicate a Strong operational performance, paired with a High valuation – deeming the stock Fairly Priced. For additional information, refer to Buy or Sell MSFT Stock.

This leads us to a crucial consideration for investors concerned about this decline: how resilient is MSFT stock if markets decline? This is where our downturn resilience framework becomes relevant. If MSFT stock declines another 20-30% to $281 – will investors be able to hold on comfortably? It appears that the stock has shown greater resilience than the S&P 500 index during various economic downturns, assessed by (a) the extent of the stock’s decline and, (b) the speed at which it recovered. Below, we delve deeper into each downturn listed.

2022 Inflation Shock

• MSFT stock fell 37.6% from a peak of $343.11 on 19 November 2021 to $214.25 on 3 November 2022 compared to a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 15 June 2023.
• Since then, the stock rose to a high of $542.07 on 28 October 2025 and currently trades at $401.72.

MSFT Stock Performance During The 2022 Inflation Shock

Trefis

2020 Covid Pandemic

• MSFT stock decreased by 28.2% from a peak of $188.70 on 10 February 2020 to $135.42 on 16 March 2020 compared to a peak-to-trough decrease of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 9 June 2020.

MSFT Stock Performance During The 2020 COVID Pandemic

Trefis

2018 Correction

• MSFT stock fell 18.6% from a peak of $115.61 on 1 October 2018 to $94.13 on 24 December 2018 compared to a peak-to-trough decline of 19.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 15 March 2019.

MSFT Stock Performance During The 2018 Correction

Trefis

2008 Global Financial Crisis

• MSFT stock fell 59.1% from a peak of $37.06 on 1 November 2007 to $15.15 on 9 March 2009 compared to a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully regained its pre-Crisis peak by 6 November 2013.

MSFT Stock Performance During The 2008 Global Financial Crisis

Trefis

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