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Inaction instead of action was a major cause of the established technology Microsoft‘S (NASDAQ: MSFT) stock dip on Wednesday. A media report saying the company is apparently unwilling to change its relationship with a troubled business partner dampened investor sentiment. Ultimately, shares closed the day down nearly 4%, a worse performance than the day’s 2.3% dip S&P500 Table of contents.
Hands off, mouth closed?
In a brief article published that morning, citing an unidentified “person familiar with the matter,” Reuters said there was no indication the company planned to CrowdStrike‘S (NASDAQ: CRWD) access to Microsoft’s Windows operating system.
The news agency did not elaborate further and Microsoft has not yet responded to the story.
Last Friday, CrowdStrike updated its cloud-based software offering. This didn’t exactly go smoothly; a defect found its way into the update and it crashed millions of Microsoft Windows devices worldwide. Many of these devices were controlled by companies that depended on them, and the resulting shutdowns were in many cases extremely disruptive.
More communication would be wise
CrowdStrike is not doing a good job of cushioning the consequences of the crisis and reassuring customers, and Microsoft is not pursuing a much smarter strategy. It seems determined to remain silent on the matter, probably in a play to appease CrowdStrike (the cybersecurity company is still an important business partner, at least at the time of writing).
Neither is a particularly sensible approach, as many of these customers suffered real reputational and even financial damage from the incident. Microsoft wasn’t directly responsible, of course, but it wouldn’t hurt the company to be more communicative and contrite about the matter.
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Erik Volkman has no position in any of the stocks mentioned. The Motley Fool holds and recommends positions in CrowdStrike and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has one disclosure policy.
Why Microsoft Stock Dropped Nearly 4% Today was originally published by The Motley Fool