Microsoft’s Nadella: AI the “next wave of platforms” for business success

Microsoft (NASDAQ:MSFT) Chief Executive Satya Nadella wasted little time on Tuesday to lay out the software titan’s new philosophy behind its foray into artificial intelligence technology.

On a conference call to discuss Microsoft’s (MSFT) Commenting on second-quarter results, Nadella said the company’s emphasis on AI was in large part due to a “changing [business] environment” resulting from customers looking to optimize their own technology spend, “given the [ongoing] economic uncertainty.” Nadella said market realities were having an impact on Microsoft’s (MSFT) own priorities.

“Maximum [business] When markets change, value is created,” Nadella said. “We are well positioned to capitalize on the capabilities of AI that are being leveraged by customers like OpenAI.”

Nadella’s comments came a day after Microsoft (MSFT) confirmed it had made a “multi-year, multi-billion dollar” investment in ChatGPT developer OpenAI. Microsoft (MSFT) did not disclose the exact amount of its investment, but various reports put it at $10 billion.

Last week Microsoft (MSFT) announced that it would begin integrating ChatGPT into its Azure cloud services offerings. On Tuesday Nadella said Microsoft (MSFT) has already transitioned more than 200 of its customers to Azure with AI.

In terms of expanding the role of AI beyond Azure, Nadella left no doubt as to where Microsoft (MSFT) appears to be taking the technology.

“We fundamentally believe that the next wave of platforms will be AI,” Nadella said. “[With AI] The core of cloud computing is changing fundamentally. We expect ourselves to integrate AI into every part of the [Microsoft technology] Stack.”

Chief Financial Officer Amy Hood provided an insight into how Microsoft (MSFT) expects its business to perform in the fiscal third quarter. Without providing accurate earnings-per-share or revenue guidance, Hood said Microsoft (MSFT) expects foreign currency exchange rates to cause a “three-point drop in revenue.”

Last week, Microsoft (MSFT) announced it would lay off 10,000 employees worldwide and face a $1.2 billion fee related to the job cuts.