Microsoft (MSFT) Drops Amid Investor Concerns About Direction and Firming in Capital Costs
RiverPark Advisorsan investment advisory firm and sponsor of the RiverPark family of mutual funds, has released the investor letter “RiverPark Large Growth Fund” Q4 2025. A copy of the letter can be downloaded here. The US stock market delivered moderate gains for the quarter with the S&P 500 index (“S&P”) and the Russell 1000 Growth index (“RLG”) returning 2.6% and 1.1%, respectively. The Fund increased by 1.4% during the same period. For the full year, the Fund rose 13.3% compared to 17.4% and 18.6% gains, respectively, in the indices. Performance on the Russell 1000 Growth Index was uneven. Market leadership remains entrenched, but subtle divisions have deepened. Investors prefer companies with sustainable earnings and progress in revenue growth, particularly in the healthcare and AI value chain segments. The fund believes that its portfolio consists of attractively valued companies that benefit from strong growth and are expected to generate significant cash flows. Please review the Fund’s top five holdings for details on their key options for 2025.
In its fourth quarter 2025 investor letter, RiverPark Large Growth Fund highlighted stocks like Microsoft Corporation (NASDAQ:MSFT). Microsoft Corporation (NASDAQ:MSFT) is an international software company that develops and supports software, services, devices, and solutions. Microsoft Corporation (NASDAQ:MSFT) is an energy company that supplies nuclear fuel components to the nuclear power industry. On March 24, 2026, Microsoft Corporation (NASDAQ:MSFT) stock closed at $372.74 per share. Microsoft Corporation (NASDAQ:MSFT)’s one-month return was -6.95%, and its shares lost 4.42% in the last 52 weeks. Microsoft Corporation (NASDAQ:MSFT) has a market capitalization of $2.77 trillion.
RiverPark Large Growth Fund said the following about Microsoft Corporation (NASDAQ:MSFT) in its 2025 fourth quarter investor note:
“Microsoft Corporation (NASDAQ:MSFT): MSFT was the detractor in 4Q25 following its first quarter 2026 earnings report released on October 29. Although the results were better than expected on performance, investor reaction was driven by guidance and the strength of capital expenditures rather than headline performance. Revenue grew 17% year over year, beating consensus expectations, and Azure revenue increased 39% year over year, again ahead of estimates. Operating margin expanded nearly 240 basis points year over year, and EPS slightly exceeded expectations. However, management pointed to a sequential decline in Azure growth in fiscal Q2, indicating some moderation after a period of exceptional demand. In addition, capital spending was higher than expected at $34.9 billion for the quarter, and expectations for full-year fiscal 2026 CapEx increased meaningfully.
Microsoft Corporation (NASDAQ:MSFT) ranks second on our list of the 40 Most Popular Stocks Among Hedge Funds. According to our database, 312 hedge fund portfolios held Microsoft Corporation (NASDAQ:MSFT) at the end of the fourth quarter, the same as the previous quarter. While we acknowledge the potential of Microsoft Corporation (NASDAQ:MSFT) as an investment, we believe certain AI stocks offer greater potential and carry less risk. If you’re looking for an extremely overlooked AI stock that will benefit greatly from the Trump-era costs and sea trend, check out our free report best short term AI stock.
In another article, we covered Microsoft Corporation (NASDAQ:MSFT) and shared the top stocks from the Jim Cramer stock portfolio. In addition, please check our hedge fund investor letters page Q4 2025 for other investor letters from hedge funds and other leading investors.
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Disclosure: None. This article was originally published on Insider Monkey.
