Below-Expected Azure Growth Hurt Microsoft’s (MSFT) Performance in Q4
Sustainable Growth Advisers (SGA), an investment management company, released its fourth-quarter investor letter for its “U.S. Large Cap Growth Strategy.” A copy of the letter can be downloaded here. In Q4 2025, the Portfolio returned 0.3% (Gross) and 0.2% (Net) compared to 1.1% return for the Russell 1000 Growth Index and 2.7% gain for the S&P 500 Index. Rising volatility, coupled with broadening market leadership, improved the portfolio’s relative performance in the second half of the quarter. In 2025, the Portfolio faced its most challenging years since the firm's inception in 2003. After a challenging year, the firm is encouraged by the robust growth potential in its portfolio and its historically attractive relative valuation. Progressing further, the portfolio is well-positioned to gain from a shift away from high momentum dynamics in U.S. markets and a broadening of market leadership. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, SGA U.S. Large Cap Growth Strategy highlighted stocks like Microsoft Corporation (NASDAQ:MSFT). Microsoft Corporation (NASDAQ:MSFT) is a multinational software company that develops and supports software, services, devices, and solutions. The one-month return of Microsoft Corporation (NASDAQ:MSFT) was -11.04%, and its shares gained 1.77% of their value over the last 52 weeks. On February 9, 2026, Microsoft Corporation (NASDAQ:MSFT) stock closed at $413.71 per share, with a market capitalization of $3.09 trillion.
SGA U.S. Large Cap Growth Strategy stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its fourth quarter 2025 investor letter:
"Microsoft Corporation (NASDAQ:MSFT), a global leader in enterprise software and cloud services, was a detractor during the quarter, despite an overall solid quarterly report. Azure growth of 39% came in slightly below expectations, and guidance for the next quarter was weaker than expected, which management asserted was due to supply constraints.
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