Microsoft stock has fallen 20% over the past year even as the company plans to spend roughly $190 billion on capital expenditures in 2026. A less-watched figure — a $627 billion backlog of contracted future revenue — offers a counter-narrative to that decline.
Microsoft shares have dropped 20% over the last year, trailing the broader market. One number dominates the debate around the name: a plan to invest roughly $190 billion in capital expenditures in calendar year 2026. Skeptics ask whether demand for artificial intelligence is real enough to justify that outlay.
Another figure gets far less attention, and it points the other way. That number is Microsoft’s Commercial Remaining Performance Obligation, or RPO — the backlog of contracted future revenue from signed deals. It currently stands at $627 billion.
How real is this future revenue
A big number is one thing; momentum is another. The commercial RPO grew 26% year-over-year even when excluding the large commitments from partner OpenAI, which points to broad demand across the business.
More telling for the near term is the pace of new business being locked in. The portion of the backlog set to be recognized as revenue in the next 12 months is up 39% year-over-year, which the source reads as a sign that customers are signing new, high-value deals.
How the backlog de-risks the AI spending
The worry around Microsoft’s spending stems from a perceived disconnect between investment and return. The RPO addresses that gap because it represents legally binding commitments from customers to pay for services in the future. That capital, therefore, is being deployed to build capacity for demand that has, in large part, already been sold.
For investors watching the stock, headline earnings will always matter. But as long as that backlog keeps growing, the source argues, it suggests the business is in a different condition than the recent share price implies.
Source: Trefis
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