Microsoft execs question Nadella's AI compute allocation as Azure rivals fill capacity gap
Microsoft is facing internal tension over how CEO Satya Nadella is distributing the company's AI computing resources amid a $190 billion capital expenditure push. Executives are questioning why external Azure clients such as Adobe appear to receive GPU allocations ahead of Microsoft's own M365 Copilot product. CFO Amy Hood had previously assured investors that first-party applications would be prioritized, with Azure customers receiving remaining capacity. Following outages on GitHub, Microsoft has reportedly begun sourcing additional compute capacity from competitors Amazon and Google. The company's stock has fallen 24% ahead of its fourth-quarter earnings report.
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