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Microsoft shares extended their decline on Wednesday even as the broader technology sector recovered.
The stock fell 2.24% at the time of writing, extending losses after declining nearly 2.2% in the previous session.
The weakness stood out as the Nasdaq Composite gained more than 2%, with most major technology stocks trading higher.
The selling pressure followed Anthropic’s unveiling of new workplace tools that could challenge Microsoft’s established Office software business.
The development has raised questions about whether AI companies are beginning to move beyond providing models and into competing directly with traditional software giants.
Anthropic takes aim at Microsoft Office
Anthropic on Tuesday introduced Claude Sheets and Claude Whiteboards in beta and made Claude Dashboards generally available as Claude Data.
Claude Sheets is the most direct challenger to Microsoft Excel.
The AI-powered spreadsheet tool allows users to create and edit workbooks using simple prompts, with support for multiple tabs, formulas, formatting and drop-down menus.
Users can also collaborate with Claude on spreadsheets, track individual changes and export files in XLSX or CSV formats. The tool connects with services including Airtable, Asana, monday.com and Smartsheet.
Claude Whiteboards allows teams to brainstorm and organize ideas, while Claude Data helps users build and share interactive dashboards. The products are available to paid Claude subscribers.
The launch is particularly interesting given Microsoft’s financial relationship with Anthropic.
Microsoft has agreed to purchase approximately $1 billion of Anthropic shares through a private placement connected to its upcoming IPO, while Anthropic has also committed to spending billions on Microsoft’s Azure cloud services.
Wall Street analysts remain bullish
Despite the latest competitive concerns, analysts continue to see considerable upside in Microsoft shares.
Evercore ISI reiterated its Buy rating on Wednesday with a $635 price target, saying that the concerns were understandable but Microsoft remains well positioned.
Evercore believes Claude could compete in how people get their work done, but “Microsoft remains deeply embedded in the infrastructure that enables it.”
RBC Capital’s Rishi Jaluria reaffirmed his Buy rating on November 10, maintaining a $640 target.
Microsoft’s recent “strong” fiscal results and the growth of its Azure cloud business were cited as reasons by Jaluria to be bullish.
The calls suggest that analysts are not yet viewing Anthropic’s new products as a fundamental threat to Microsoft’s business as the company retains several important competitive advantages.
Microsoft fights for data center expansion
Meanwhile, Microsoft is also facing infrastructure challenges as it races to expand its AI computing capacity.
Reuters reported that the company has urged the Trump administration to reconsider a proposed restriction on imports of new Chinese optical transceivers used in data centers.
Microsoft warned that limiting access to the components could delay construction projects because domestic suppliers currently lack sufficient capacity.
The company has 35 data centers under construction in the US and another 134 planned, according to Cleanview data.
AI disclosure: AI tools assisted with research and drafting of this piece. An Invezz editor reviewed the facts, sources and wording before publication. Any opinions or analysis are Invezz’s, not those of an automated system.
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