{"id":741272,"date":"2026-07-27T14:50:22","date_gmt":"2026-07-27T11:50:22","guid":{"rendered":"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/"},"modified":"2026-07-27T14:50:22","modified_gmt":"2026-07-27T11:50:22","slug":"nadella-sets-a-condition-for-the-ai-boom-on-cnn","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/","title":{"rendered":"Nadella sets a condition for the AI boom on CNN"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_89 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6aeea17511886\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6aeea17511886\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#Who_gets_the_chips\" >Who gets the chips<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#Selling_what_you_cannot_deliver\" >Selling what you cannot deliver<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#The_trap_Microsoft_is_actually_in\" >The trap Microsoft is actually in<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#The_ecosystem_argument\" >The ecosystem argument<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#Three_businesses_in_the_blast_radius\" >Three businesses in the blast radius<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#The_billy_club\" >The billy club<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/buradabiliyorum.com\/en\/nadella-sets-a-condition-for-the-ai-boom-on-cnn\/#Wednesdays_test\" >Wednesday\u2019s test<\/a><\/li><\/ul><\/nav><\/div>\n<p><img decoding=\"async\" src=\"https:\/\/media.thenextweb.com\/2026\/06\/microsoft-nadella-ai-reboot-leadership-restructure-slt.avif\" \/><\/p>\n<div id=\"article-main-content\">\n<p>Fareed Zakaria opened with the question everyone is circling. Are we in an AI bubble, and has it begun to deflate? OpenAI has promised to spend hundreds of billions while making a fraction of that, he noted. The maths does not add up.<\/p>\n<p>Nadella did not push back. He reframed the question as a test AI has to pass.<\/p>\n<p>\u201cThis is a new <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a>-purpose <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> that is going to drive productivity,\u201d he said <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/edition.cnn.com\/2026\/07\/26\/business\/video\/gps-0726-microsoft-interview-satya-nadella\" target=\"_blank\" rel=\"nofollow noopener\">on CNN\u2019s <em>GPS<\/em><\/a>. \u201cThat productivity has to translate into very broad-based economic growth that is economy-wide in terms of GDP growth.\u201d<\/p>\n<p>Then the condition. \u201cIf we don\u2019t see that, then we are going to have a problem. So unless we see that broad economic growth, we\u2019re not going to have this movie end well.\u201d<\/p>\n<p>It is a striking thing for the man who spent $190bn this year to say two days before his earnings call.<\/p>\n<div class=\"inarticle-wrapper channel-cta\">\n<div class=\"ica-text\">\n<p class=\"ica-text__title\">TNW City Coworking space &#8211; Where your best work h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ens<\/p>\n<p>A workspace designed for growth, collaboration, and endless networking opportunities in the heart of tech.<\/p>\n<\/div>\n<\/div>\n<h2><span class=\"ez-toc-section\" id=\"Who_gets_the_chips\"><\/span>Who gets the chips<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The other Nadella showed up the same weekend, in his own executives\u2019 account of the company. Microsoft cannot build capacity fast enough. The shortfall has forced it into triage, <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.businessinsider.com\/inside-nadella-hardest-year-microsoft-ai-azure-github-2026-7\" target=\"_blank\" rel=\"nofollow noopener\">Business Insider\u2019s Ashley Stewart reported<\/a>. Its own AI products eat first. Azure customers get the remainder.<\/p>\n<p>Chief financial officer Amy Hood said as much on January\u2019s earnings call. Microsoft solves first for M365 Copilot and GitHub Copilot, then for research and development.<\/p>\n<p>\u201cThen what you end up with is the remainder going towards serving the Azure capacity that continues to grow in terms of demand,\u201d she said. Had those chips gone to Azure instead, she added, growth would have topped 40% rather than 39%.<\/p>\n<p>That admission is not new to readers here. A Michigan pension fund sued Microsoft in June over precisely this. The suit alleges the company hid the diversion before a January drop erased $357bn of market value.<\/p>\n<p>What is new is that insiders say it has got worse. \u201cAll of the supply is gone once you solve for frontier labs and our internal businesses like M365 and Microsoft AI,\u201d one executive told Business Insider.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Selling_what_you_cannot_deliver\"><\/span>Selling what you cannot deliver<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Here is the part that reads oddly. Microsoft is raising quotas for its Azure salespeople despite the crunch. Some quotas rise by 30% this year, according to people familiar with the change.<\/p>\n<p>Meanwhile it is buying capacity from its rivals. Amazon bailed Microsoft out after a run of GitHub outages. It explored leasing Oracle cloud infrastructure and walked away over security and compliance concerns. It is now evaluating Amazon and Google.<\/p>\n<p>\u201cWe are shopping for capacity everywhere,\u201d one person familiar with the talks said.<\/p>\n<p>Inside the company, the logic is understood and the messaging is not. One executive framed the trade-off bluntly: why would Nadella prioritise growing Adobe, an Azure customer, over growing M365?<\/p>\n<p>\u201cI have no idea how we\u2019re going to land that message with customers,\u201d the person added.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_trap_Microsoft_is_actually_in\"><\/span>The trap Microsoft is actually in<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The dilemma is real, and Microsoft is not obviously handling it wrongly. Serving Azure customers lifts revenue now. Serving its own products is a bet that they eventually win.<\/p>\n<p>Starve the first and Azure growth disappoints, which hits the share price im<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>tely. Starve the second and Microsoft slips further behind in the race that justified the spending in the first place.<\/p>\n<p>What makes the choice urgent is that customers have somewhere else to go. Google Cloud keeps posting large numbers. Meta and SpaceX are now selling compute too. Microsoft\u2019s customers may not wait to find out what it decides.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_ecosystem_argument\"><\/span>The ecosystem argument<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Zakaria\u2019s second question was about China. Most firms are not using AI to solve Fermat\u2019s theorem, he pointed out. They are rationalising inventory systems. So will the world simply take the cheaper Chinese open-weight models, like Moonshot\u2019s Kimi?<\/p>\n<p>Nadella\u2019s answer was that provenance matters less than plumbing. \u201cEven take the Chinese models. Guess where these models run? They run on a lot of the hyperscalers that are American, all over the world.\u201d<\/p>\n<p>Because the weights are open, he argued, American firms can monitor, test and post-train them. If a US lab post-trains a Chinese base model and ships it, he asked, whose model is that?<\/p>\n<p>\u201cAs long as that remains, we will absolutely be competitive and we will win,\u201d he said. China will have a role, he added, but this is not a zero-sum <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a>.<\/p>\n<p>He has been making a version of this case all week. His pinned post asks how to ensure \u201cfrontier benefits are diffused across the entire ecosystem\u201d now that <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/x.com\/satyanadella\/status\/2080329851127669104\" target=\"_blank\" rel=\"nofollow noopener\">software has real marginal cost<\/a> for the first time. Diffusion is the theory. Triage is the practice.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Three_businesses_in_the_blast_radius\"><\/span>Three businesses in the blast radius<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The strain is not only physical. Three core businesses now sit in AI\u2019s path at once.<\/p>\n<p>Microsoft 365 is the first. Knowledge workers used to open Word, Excel and PowerPoint to start the day. Increasingly they start inside an AI tool instead. Gartner <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.gartner.com\/en\/newsroom\/press-releases\/2026-03-11-gartner-announces-top-predictions-for-data-and-analytics-in-2026\" target=\"_blank\" rel=\"nofollow noopener\">predicted this year<\/a> that AI would threaten to dethrone traditional productivity suites in a $58bn shakeup.<\/p>\n<p>GitHub is the second. It had its best month ever, an executive told staff. It has also suffered dozens of major outages this year as AI usage surged. Cursor and Claude Code have taken millions of engineers in the meantime.<\/p>\n<p>Azure is the third, and it is the one being asked to wait its turn.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_billy_club\"><\/span>The billy club<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Nadella has pushed the pressure downwards. He has dismantled the senior leadership team structure and handed the commercial business to Judson Althoff. He also put a 33-year-old ex-Snap executive in charge of Copilot.<\/p>\n<p>The churn continues. Rajesh Jha has retired, Yusuf Mehdi is preparing to leave, and Charlie Bell has moved to an individual contributor role. Hayete Gallot, recruited back from Google, is seen internally as Althoff\u2019s long-term successor.<\/p>\n<p>Microsoft also overhauled performance reviews this year, cutting ratings to five categories and sharpening the distinctions between them. Executives say it feels like a return to the stack ranking of the Ballmer era. Managers have been told to thin out the higher-level engineering ranks.<\/p>\n<p>\u201cIt\u2019s almost like the old era of Microsoft is back,\u201d one former executive said. \u201cThe old Windows era where you lead with a lot of fear and a billy club in your hand.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Wednesdays_test\"><\/span>Wednesday\u2019s test<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Microsoft reports fourth-quarter results on Wednesday. Amazon follows on Thursday. Between them the two will spend roughly $400bn on data centres this year, <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/fortune.com\/2026\/07\/27\/amazon-microsoft-alphabet-google-stock-cloud-ai-spending-billions\/\" target=\"_blank\" rel=\"nofollow noopener\">Fortune reported<\/a>, with Microsoft near $190bn.<\/p>\n<p>Investors are already twitchy. Alphabet\u2019s stock fell 7% last Thursday after it raised capital-expenditure guidance and posted negative free cash flow. Microsoft shares are down about 19% this year, and roughly 25% over twelve months. That is the worst of the Magnificent 7 by some distance. Meta is next, down almost 17%.<\/p>\n<p>The underlying business is not weak. Microsoft disclosed nearly $627bn of remaining performance obligations, almost double a year earlier. It is funding roughly $35bn of building a quarter from operating cash flow rather than new debt. Azure and other cloud services are forecast to reach $148.9bn in fiscal 2027.<\/p>\n<p>Nadella has heard doubts before. \u201cI remember when I became CEO, everybody said, oh my God, isn\u2019t it too late man?\u201d he recalled at a Morgan Stanley conference in March. Microsoft built anyway, and the public cloud turned out to be multiplayer.<\/p>\n<p>At that same conference he described the plan. \u201cWe have OpenAI book, we have Anthropic book, but we want to also have the long tail of enterprise IT,\u201d he said. The long tail is the part now waiting at the back of the queue.<\/p>\n<\/p><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMN63nwsw68G3Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more like this article, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" target=\"_blank\" >Technology category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/thenextweb.com\/news\/nadella-microsoft-compute-crunch-azure-customers-copilot-priority\" target=\"_blank\" >Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Fareed Zakaria opened with the question everyone is circling. Are we in an AI bubble, and has it begun to deflate? OpenAI has promised to spend hundreds of billions while making a fraction of that, he noted. The maths does not add up. Nadella did not push back. He reframed the question as a test&#8230;<\/p>\n","protected":false},"author":1,"featured_media":741273,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/media.thenextweb.com\/2026\/06\/microsoft-nadella-ai-reboot-leadership-restructure-slt.avif","fifu_image_alt":"","footnotes":""},"categories":[18],"tags":[],"class_list":["post-741272","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/741272","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=741272"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/741272\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/741273"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=741272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=741272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=741272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}