Microsoft

Microsoft AI CEO Mustafa Suleyman declared the company will not develop “simulated erotica” AI services, diverging from partner OpenAI, which is exploring such applications. Suleyman emphasized the dangers of AI intended for intimate interaction, citing ethical concerns about “seemingly conscious” AI and potential social divisions. This decision reflects a broader strategic difference, with Microsoft prioritizing ethical considerations and user well-being over potentially problematic AI applications, while OpenAI explores the boundaries of AI. OpenAI and xAI (Elon Musk’s company) offered contrasting responses when asked for comment.

Microsoft CEO Satya Nadella’s total compensation surged to $96.5 million in fiscal year 2025, a 22% increase driven by strong stock performance and AI demand. Stock awards and cash incentives heavily weighted towards share performance fueled the rise. Microsoft’s cloud-based AI solutions, particularly Azure, contribute significantly to rapid growth and outperformed the S&P 500. Despite financial success, Microsoft faced workforce reductions and internal issues regarding collaborations with the Israeli military.

Microsoft is sunsetting Windows 10 to focus on Windows 11 with integrated AI features, aiming to capitalize on the growing AI PC market. Users can access advanced AI functionalities, including an enhanced Copilot assistant automating tasks via natural language. This aligns with advancements in AI “computer-use agents.” Copilot Actions, initially for enterprise users, will democratize AI-driven automation in Windows 11 but are disabled by default with user monitoring. This move aims to attract users from competitor platforms. Microsoft is cautiously rolling out Copilot Actions, prioritizing stability and user satisfaction.

Nscale, a UK-based AI cloud infrastructure provider, confirmed it is considering an IPO, aiming for a listing potentially in late 2025. This follows a $14 billion deal with Microsoft, part of a larger $23 billion agreement for Microsoft to acquire around 200,000 Nvidia GB300 GPUs. This deal, combined with previous funding rounds including a $1.1B Series B, highlights Nscale’s rapid growth driven by the increasing demand for AI infrastructure. Investors include Dell, Nvidia and Nokia. The potential IPO could significantly impact the European tech and AI ecosystem.

A Microsoft engineer resigned after 13 years, citing ethical concerns over the company’s cloud services provided to the Israeli military amidst the Gaza conflict. This followed employee protests at Microsoft’s Redmond headquarters, demanding the company cease business with Israel. The resignation letter alleges active Microsoft subscriptions used by the Israeli military and claims the company has limited internal dialogue and curtailed communication channels regarding employee concerns. Demonstrations outside headquarters highlight the ongoing divisions within Microsoft over its involvement in the conflict.

Judson Althoff is appointed CEO of Microsoft’s commercial business, a move by Satya Nadella to consolidate sales, marketing, operations, and engineering under a unified AI-driven strategy. This realignment emphasizes Microsoft’s focus on empowering clients with AI capabilities, transforming operations, and solidifying its position as a leading AI partner. Althoff’s experience, including his role as President of Microsoft North America, makes him well-suited to drive Microsoft’s AI-centric growth. This appointment reflects Microsoft’s decentralized structure and commitment to innovation, mirroring the leadership approaches at LinkedIn and Microsoft AI.

Microsoft is pursuing self-sufficiency in data center infrastructure by increasing its use of custom-designed chips. CTO Kevin Scott emphasized the company’s commitment to securing optimal performance, currently relying on Nvidia and AMD while actively deploying its Azure Maia AI Accelerator and Cobalt CPU. Microsoft aims for complete system design, including cooling and networks, and acknowledges an industry-wide compute capacity shortage despite massive AI investments. This strategy mirrors similar efforts by Google and Amazon for performance, efficiency, and cost advantages.

Microsoft is increasing the price of Xbox Game Pass Ultimate by 50% to $29.99/month, while streamlining its subscription tiers by integrating Core into Essential and upgrading Standard to Premium. This move aims to enhance value through expanded game libraries (including Ubisoft+ Classics), improved streaming quality, and a new rewards program. The company cites the need to deliver more value amid competition from Sony’s PlayStation Plus and declining Xbox hardware revenue, despite strong Game Pass subscriber growth following the Activision Blizzard acquisition. Select Xbox consoles will also see price increases.

Microsoft is streamlining its AI subscription strategy with Microsoft 365 Premium, a $19.99/month bundle combining Copilot Pro with Microsoft 365 Family. This integrates AI into Word, Excel, and PowerPoint, offering higher usage limits than the free Copilot and delivering on document summarization, data analysis, and presentation creation. This is intended to provide greater value and utility to consumers. Microsoft’s move reflects a shift towards integrated AI solutions in the evolving AI market, leveraging its partnership with OpenAI and aiming to strengthen its competitive position.

Microsoft promotes Judson Althoff to CEO of its commercial business, encompassing sales, marketing, and operations. CEO Satya Nadella emphasizes a focus on AI integration to empower clients. The move consolidates key revenue-generating divisions, including productivity software and cloud-based AI infrastructure. This restructuring aims to accelerate growth, enhance AI-driven transformation, and solidify Microsoft’s market position against competitors like AWS and Google Cloud. Althoff’s expanded role reflects Microsoft’s commitment to leveraging AI across all commercial operations.