Microsoft shares recovered on Friday after a global outage disrupted its Outlook, Teams and Copilot services, affecting users across more than 70 countries.
The incident has renewed concerns about businesses’ dependence on centralised cloud services, while intensifying competition in artificial intelligence adds to the pressure on the technology giant.
Microsoft apologises as outage disrupts services
Microsoft shares MSFT rose approximately 0.18% to $523.94 on Friday, recovering from a decline of more than 2% in premarket trading.
The outage, which began on Thursday, November 12, affected several Microsoft 365 services, including Outlook email, Teams and the Copilot AI assistant.
According to Downdetector, users across more than 70 countries reported disruptions.
The incident affected services used by more than 430 million people, alongside governments and organisations worldwide.
Microsoft engineers worked for more than 20 hours to address the disruption.
In its latest updates, Microsoft apologised for the outage, saying it was “deeply sorry” for the disruption caused since Thursday.
In a 3:05 p.m. EST update, the company said it did not yet have a timeline for full recovery.
Earlier, Microsoft had said it was seeing “broad recovery and stability” across its services.
“Given the scale of demand, we restored services gradually, validating stability at each stage. While this took longer, it helped ensure a stable restoration,” the company said in an earlier update.
Microsoft also dismissed speculation that the outage was linked to technical issues involving artificial intelligence agents.
It said the incident was caused by a technical issue and was not related to cybersecurity or AI agents.
The company plans to publish a full post-incident report after completing its review.
Outage highlights dependence on cloud services
The disruption has drawn attention to the risks associated with businesses relying heavily on a small number of major technology providers.
Microsoft’s cloud-based model allows organisations to avoid the costs of operating and maintaining their own email servers and infrastructure.
However, a prolonged outage at a major provider can affect large numbers of businesses simultaneously.
Microsoft’s second-quarter availability for its Microsoft 365 workplace applications was reported at 99.994% globally, making prolonged disruptions relatively rare.
Nevertheless, the incident could encourage companies to invest more in backup services and continuity arrangements.
Providers such as US cybersecurity firm Mimecast offer continuity services that allow users to send and receive emails through temporary inboxes when their primary systems become unavailable.
Privacy-focused technology company Proton also offers standby email accounts that businesses can activate during disruptions.
According to a study by Oxford Economics and Splunk, unplanned outages of critical digital business systems cost Global 2000 companies an average of $15,000 per minute.
While continuity services have traditionally attracted deadline-sensitive industries such as law, the latest disruption could encourage wider adoption among accounting firms, hospitals and other regulated businesses.
Geopolitical tensions have also increased concerns about dependence on US technology providers, particularly in Europe.
The outage highlighted how technical failures alone can disrupt access to essential digital services.
AI competition adds to pressure on Microsoft
The outage comes at a challenging time for Microsoft as investors assess its position in the artificial intelligence market.
Recent reports about OpenAI’s latest figures have raised questions about its competitive position relative to Anthropic.
Microsoft owns a 24% stake in OpenAI and has a smaller investment in Anthropic.
Anthropic also recently introduced a new suite of office tools, adding to competition in a market where Microsoft has a significant presence through its productivity software and Copilot assistant.
Investors will be watching Microsoft’s upcoming Ignite conference for updates on its AI strategy and cloud platform Azure.
Citi analyst Tyler Radke said the event could reinforce confidence in the company’s AI growth outlook.
“We expect the event to reinforce confidence in Microsoft’s AI growth narrative,” Radke said in a research note.
The conference could provide investors with further insight into Microsoft’s cloud and Copilot developments as the company seeks to maintain its position in an increasingly competitive AI market.
