Artificial Intelligence · Profile from AI Research Companion
Microsoft
The Redmond software company that made the earliest and largest bet of any incumbent on generative AI, investing ~$13bn in OpenAI from 2019 to 2023 in return for exclusive cloud hosting, rights to OpenAI's models and a share of its profits, and then putting those models into Bing, GitHub, Office and Windows under the "Copilot" brand. The bet turned Azure into the fastest-growing large cloud (+48% in the September 2026 quarter, company) and left Microsoft holding ~27% of OpenAI Group PBC (~$135bn at the October 2025 recapitalisation, reported). It also made Microsoft dependent on a partner it did not control. From 2024 Microsoft hedged: it hired Inflection's founders to build in-house models, bought capacity from neoclouds, put Anthropic's Claude into Copilot and took a stake in Anthropic, and in April 2026 accepted a non-exclusive licence to OpenAI's technology (reported). Its capex rose from ~$28bn in fiscal 2023 to a guided ~$175bn for fiscal 2027 (reported, verify).
At a glance
- Founded
- April 1975, Albuquerque, by Bill Gates and Paul Allen; moved to the Seattle area in 1979; public since March 1986
- Headquarters
- Redmond, Washington
- Ownership / structure
- Public (Nasdaq: MSFT); widely held, the largest holders being index funds (Vanguard, BlackRock, State Street). Gates and Ballmer remain large individual holders (reported, verify current stakes)
- Leadership (2026)
- Satya Nadella (CEO since February 2014, chair since June 2021); Amy Hood (CFO); Brad Smith (vice chair and president); Kevin Scott (CTO, architect of the OpenAI partnership); Mustafa Suleyman (CEO, Microsoft AI, since March 2024); Scott Guthrie (Cloud + AI); Jay Parikh (CoreAI – Platform and Tools, since January 2025); Judson Althoff (CEO of the commercial business, since October 2025) (company, verify titles)
- AI products
- Azure AI Foundry (model hosting for OpenAI, Anthropic, Meta Llama, Mistral, DeepSeek, xAI and in-house MAI and Phi models); Azure OpenAI Service; Microsoft 365 Copilot, Copilot Studio and agents; consumer Copilot (formerly Bing Chat); GitHub Copilot; Copilot+ PCs and Recall; Dynamics 365 Copilot; Security Copilot; Maia AI accelerator and Cobalt CPU
- Scale
- Revenue ~$281.7bn and operating income ~$128.5bn (fiscal year to June 2025, company); ~$92.3bn revenue (+19%) and Microsoft Cloud ~$63.9bn (+30%) in the September 2026 quarter; Azure revenue above ~$100bn for fiscal 2026 (company, reported, verify); commercial remaining performance obligation (RPO) ~$677bn (+73%) at September 2026 (company); ~228,000 employees (June 2025)
- AI-specific metrics (company claims)
- AI business above a $13bn annual revenue run rate (January 2025); Microsoft 365 Copilot 15m paid seats (January 2026) and >30m (July 2026, reported); GitHub Copilot >20m all-time users (July 2025)
- Capex
- ~$44bn cash, ~$56bn including finance leases (FY2024); ~$65bn cash, ~$88bn including leases (FY2025); ~$35–41bn a quarter through FY2026 (reported); cash additions to property and equipment ~$39.4bn in the September 2026 quarter; ~$175bn guided for FY2027 including a lease reclassification (reported July 2026, verify)
- Key AI partnerships
- OpenAI (~27% stake; ~$250bn incremental Azure commitment; IP rights to 2032, non-exclusive from April 2026, reported); Anthropic (up to $5bn investment; ~$30bn Azure commitment, November 2025); Inflection (~$650m licence-and-hire, March 2024); Mistral (€15m stake, February 2024); G42 ($1.5bn, April 2024); Nvidia and AMD (chips); CoreWeave, Nebius, IREN, Lambda, Nscale (leased capacity); Constellation (Crane/Three Mile Island restart)
- Signature moves (incl. failures)
- The OpenAI investment and Azure exclusivity (2019–23); GitHub Copilot (2021); Bing Chat and the "Sydney" episode (2023); Microsoft 365 Copilot and the $30 seat (2023); the OpenAI board crisis (2023); the Inflection licence-and-hire (2024); the Recall backlash (2024); the capex surge, neocloud leasing and the 2025 "pacing" (2025); the OpenAI recapitalisation and 2026 amendment (2025–26); the Anthropic deal and MAI models (2025–26)
10 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
2019
OpenAI Investment and Azure Exclusivity
Partnership / compute deal (minority economic interest plus exclusive cloud agreement)
2021
GitHub Copilot
Launch
2023
Bing Chat and the Sydney Episode
Launch (troubled)
2023
Microsoft 365 Copilot and the 30 Dollar Seat
Launch / pricing
2023
OpenAI Board Crisis
Partnership crisis (governance shock and response)
2024
Inflection Licence and Hire
Licence-and-hire ("reverse acqui-hire")
2024
Recall Backlash and Copilot Plus PCs
Launch (withdrawn and relaunched)
2025
AI Capex Neocloud Leasing and the Pause
Compute deal / capital expenditure programme (including a partial reversal)
2025
Anthropic Deal and MAI Models
Partnership / compute deal / model release (diversification away from a single lab)
2025
OpenAI Recapitalisation and 2026 Amendment
Restructuring (renegotiation of a strategic partnership)