Microsoft Looks Like a “Table Pounder” After Dipping on AI Worries

If you’ve been waiting for an opportunity to pick up shares of Microsoft (NASDAQ:MSFT) on the cheap amid broad AI and tech jitters, here’s your chance. The stock has been beaten down in recent months, now off more than 12% from its recent all-time highs. And while the still seemingly frothy 33.89 times trailing price-to-earnings (P/E) multiple doesn’t seem to suggest Microsoft shares are a “table pounder,” I do think that the premier hyperscaler remains one of the best bets of the Magnificent Seven.

Of course, its close ties to OpenAI used to be a positive. Nowadays, it’s a negative, with ChatGPT losing a bit of ground in the AI race to the likes of Alphabet (NASDAQ:GOOG), which has seemingly caught up with the release of its well-received Gemini 3.0 model.

But just because Google Gemini and the hardware running behind the scenes (Google TPUs) are having their moment, it does not mean we should start treating OpenAI as a laggard. Is the AI innovator behind ChatGPT a bit heavy on the debt, with more than a handful of circular deals?

AI spending fears are weighing on the hyperscalers, Microsoft included

Sure, but just because we’ve got reminders of the internet bubble and dot-com bust does not mean we’re in for an exact repeat. Of course, heavy debt loads and extreme spending might be a concern for many. And circular dealmaking in the AI scene makes things a tad trickier and perhaps scarier for those with AI bubble fears.

However, I think the big question is whether or not the AI efforts are going to pay off. If they do, leverage might work out heavily in the AI titan’s favor in a big-time way. Of course, it’s hard to tell how the AI frenzy ends, when it will end, and if the pain will be as bad as the dot-com bust. Either way, I think investors might wish to treat Microsoft as more than just an OpenAI proxy.

At the end of the day, Microsoft has been making its own investments to lessen its dependence on ChatGPT. Even if a worst-case scenario happens and OpenAI runs into a bit of financial trouble at some point down the road while giving up more ground to rival AI models, Microsoft can go its own way.

OpenAI aside, Microsoft has plenty of its own AI firepower

Azure is the star of the show, and Microsoft can swap out the model running behind the scenes with another one, including its own (think the MAI model). With a powerful, arguably one of the most powerful, AI teams in the world, headed by a genius in Mustafa Suleyman, I’d argue that Microsoft’s own AI dream team is worth the premium price tag. 

Either way, Microsoft has more than one racer in the AI race, and that improves the enterprise software behemoth’s chances of having a winner on the road to AGI (artificial general intelligence).

Either way, I think far too many investors are doubting OpenAI. But with the release of GPT-5.2, it’s clear that OpenAI is a hungry company that’s willing to do whatever it takes to keep that AI ball rolling. If anything, I’d argue that Gemini 3.0 and the “code red” it gave OpenAI is a good thing. It might be the nudge the firm needs to sprint that much faster.

In any case, I continue to view OpenAI as a massive positive for Microsoft that the market will appreciate again, perhaps in due time, or after the release of GPT-6, which one has to think will be smoother and far more impressive than the launch of GPT-5.

What about jitters over that report on lower AI sales quotas?

Finally, there’s renewed anxiety that Microsoft’s AI sales will miss the mark following a report from The Information that some divisions reduced their sales growth quotas.

The company has since denied the report, but, nevertheless, it seems like the investor unease has stuck around. If a future quarter proves sales jitters are unwarranted, perhaps Microsoft stock is unfairly sold off right here. In any case, I think 2026 could be a huge year for AI monetization, and few firms, I think, are better prepared than Microsoft.

Whether we’re talking about the OpenAI worries, broad bubble fears, or The Information report, I think there’s too much negativity in Microsoft stock right here. And that might make its stock one of the bigger “table pounders” for the new year.