A securities fraud class action lawsuit has been filed against Microsoft Corporation (NASDAQ:MSFT) and certain senior executives, following a 10% stock drop on January 28, 2026. The complaint, filed in the U.S. District Court for the Western District of Washington, alleges Microsoft misled investors regarding its Azure cloud computing platform and AI chatbot Copilot. According to the complaint, Microsoft touted Copilot's best-in-class capabilities and surging Azure-related revenue, but in truth, Copilot suffered from severe functionality issues that caused user adoption to decline and put Azure revenue at risk. On January 28, 2026, Microsoft announced disappointing 2Q 2026 financial results and that Azure growth had slowed suddenly, also revealing that Microsoft 365 Copilot premium customers totaled only 15 million, materially below analyst estimates. This news caused the stock to decline $48.13 per share, or 10%, from $481.63 per share on January 28, 2026, to $433.50 per share on January 29, 2026. The lawsuit asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. Investors have until August 11, 2026, to ask the Court to be appointed to lead the case. The case is captioned City of St. Clair Shores Police and Fire Retirement System, et al., No. 26-cv-02071.