Modern software systems are increasingly shifting from monolithic architectures to microservices to enhance scalability, maintainability, and deployment flexibility. Existing microservice extraction methods typically rely on hard clustering, assigning each software component to a single microservice. This approach often increases inter-service coupling and reduces intra-service cohesion. We propose Mo2oM (Monolithic to Overlapping Microservices), a framework that formulates microservice extraction as a soft clustering problem, allowing components to belong probabilistically to multiple microservices. This approach is inspired by expert-driven decompositions, where practitioners intentionally replicate certain software components across services to reduce communication overhead. Mo2oM combines deep semantic embeddings with structural dependencies extracted from methodcall graphs to capture both functional and architectural relationships. A graph neural network-based soft clustering algorithm then generates the final set of microservices. We evaluate Mo2oM on four open-source monolithic benchmarks and compare it against eight state-of-the-art baselines. Our results demonstrate that Mo2oM achieves improvements of up to 40.97% in structural modularity (balancing cohesion and coupling), 58% in inter-service call percentage (communication overhead), 26.16% in interface number (modularity and decoupling), and 38.96% in non-extreme distribution (service size balance) across all benchmarks.