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[ZehDon]

Yeah - you can't spend a hundred billion on AI with minimal profits while gutting your gaming division and demand they deliver a profit margin that's double the industry standard and expect it to all work out.

Once Nadella is forced to face the cold reality of his AI over-spend, he'll have done irreparable damage to several of a Microsofts divisions.
An OS division that shed double digit install base and have their competitor the push they needed to go mainstream.
A gaming division that's so badly damaged, with such a tarnished brand, that they can't ever rebuild.
A cloud business that sacrificed potential customers so that Microsoft could deliberately build an internal addiction to producing broken code and sloppy products while firing tens of thousands of developers.

Nadellas legacy is likely going to be leaving a fucking mess of AI slop that his replacement will need to spend a decade trying to fix, only to discover Xbox can't be saved, Windows burned its bridges, businesses don't a subpar cloud stack, and Microsoft doesn't have the trained, experienced staff it needs to dig itself out.

I'm not seeing a possible win here for Nadella anymore. I'm seeing the sunk cost fallacy that he thinks he can recover from if he has to - not realising he's cut off his nose to spite his face.

 

[Daniel_Mallorca1985]

 

[Mr.Phoenix]

If they had paid me $1M, thats 0.0003% of what they just lost, I would have solved all their problems.

MS are proper idiots.

 

[Tiago Rodrigues]

As i said in a different topic: I think this is the beginning of the "end" for the MS's stock increases and records for a while (years maybe).
Not only their earnings were disappointing (from its fall quarter lol) they won't be able to justify all the AI investments forever. Not without some decent returns.

Glad i sold their stock.

 

[squallbr]

More Studios gonna Close.....project Phil Spencer is burning up

 

[BloodFree]

It's ok, all they have to do is fire more people and throw and burn more money into the AI oven.

 

[winjer]

No wonder Satya was trying to stop people from calling AI Slop to their products.
He knows he is selling crap and people are tired of it.

 

[PeteBull]

More Studios gonna Close.....project Phil Spencer is burning up

I bet he has some nasty receipts on mr nuttela from when they both partied hard(emphasis on hard ) in thailand with some ladyboys, otherwise he would be fired years ago

 

[GHG]

Everyone when they realize that the stock slide is because investors are unhappy that MS aren't investing enough in AI.

Well done misreading the market I guess.

Microsoft says OpenAI is driving 45% of the backlog for Azure cloud computing

OpenAI and Microsoft have a reconfigured relationship. The software giant revealed just how much OpenAI is driving its RPO.

www.businessinsider.com

If that 45% doesn't come through they have a lot more to worry about than just the Xbox division.

 

[Cancer]

A market cap? What's interesting about that?

 

[mdkirby]

I'm betting google eats everyone. They came from behind with ai, but are now pissing on everyone's parade. Best image models and tools sets, excellent video models, and genie 3 world models will in future versions literally spit out games on request, and in the meantime is being used to train their SIMA models on how the world works, which is a path to agi. Xai also has a chance, given the massive realtime data from X, Teslas and soon Optimus. Microsoft and open ai for that matter will trail behind and whither away.

 

[Dr.Morris79]

If they had paid me $1M, thats 0.0003% of what they just lost, I would have solved all their problems.

MS are proper idiots.

I could have done it for free

I think any of us could.

These people are complete buffoons.

 

[kazuyamishima]

 

[PauloRoberto]

This is a absolutely public perception disaster... of course we do know those numbers are a sum of lots of factors... but the fact that the CFO publicly put the blame on gaming division is VERY telling.

 

[Ronin_7]

Microsoft has become a pathetic joke. Compared to Google, they are embarrassing themselves. Their AI is utter trash. They squandered a massive lead and are now getting destroyed in a race they practically owned. It is absolute incompetence.

 

[Jormatar]

They will recoup the loss next year when it's time to fire the annual 20,000 employees.

 

[bighugeguns]

This is an absolutely public perception disaster... of course we do know those numbers are a sum of lots of factors... but the fact that the CFO publicly put the blame on gaming division is VERY telling.

And then that blame will trickle down to the loudest frictions…

Incoming chud golden age. Good or bad, we might see a big shift in culture.

Going to keep eyes on Blizzard for signs of change.

 

[DavidGzz]

Ah shit. Xbox gonna go poof and the PS6 will outdo the PS5 for the worst PS gen ever. Can't wait.

 

[Lord Panda]

 

[J Required]

They lost $357 billion, $357 billion, and still have $3.22 trillion, its insane.

Market valuation, not actual cash.

 

[FreeY$L]

Praying on microsoft's downfall has paid off

 

[KungFucius]

But hey, at least they raised the price of PC Game Pass. Imagine how bad things could have been if they just left the price alone.

It will be interesting to see what happens next quarter. The price increase led to a 5% decline in revenue in its first quarter. Many have long subs and re-up when they expire. I think more people won't be reupping this next quarter and that will start to show in revenue. I also think they will lose more people who still sub at the high prices when they realize they can stop paying for a few months and let a backlog build.

 

[Breakfast at Noon]

Sacked loads, massive use of AI.. and still a huge loss?
Sounds to me like a management problem.

 

[TKOFromTokyo]

The stock was down because of slowing cloud revenue growth and concerns over AI spend.

As bad as Xbox results were, they are just a drop in the bucket compared to the other two areas.

 

[EN250]

At this point, they will drop windows and office, doesn't make enough compared to AI.

No one is making bank on AI as a service, just the ones making the HW for it, doesn't this Open AI thing going bankrupt anytime because "the money to be made" is nowhere near enoguh to recoup even the cost of running this business?

https://www.windowscentral.com/arti...chatgpt/openai-might-torch-14-billion-in-2026

Hell, they don't even know how to get that money in the first place, "just let people use it and see if these large amount of HW learn something by itself and start making cash on its own, I guess"

https://futurism.com/artificial-intelligence/ibm-ceo-math-ai

 

[WoJ]

And Phil Spencer still has a job after spending a decade destroying Xbox. Pathetic.

 

[adamsapple]

Everyone when they realize that the stock slide is because investors are unhappy that MS aren't investing enough in AI.

Papito let people enjoy this "gaming" news.

 

[ChorizoPicozo]

And Phil Spencer still has a job after spending a decade destroying Xbox. Pathetic.

He is clinging to the Magnus to try to leave on a high note with a renew spin on the narrative. It's just astonishing that not even Aaron Ggreenberg has been fired. (just even if it's a way to simulate accountability)

But I have the gut feeling somehting will have to break in that inner circle with the next round of layoffs and prices hikes. The brand, the division can't hold the line anymore.

 

[Deerock71]

Now...even Microsoft has to feel that.

 

[Dirk Benedict]

Uh-oh. Bad earnings call. Time for more layoffs to offset.

 

[JohnnyFootball]

Microsoft has become a pathetic joke. Compared to Google, they are embarrassing themselves. Their AI is utter trash. They squandered a massive lead and are now getting destroyed in a race they practically owned. It is absolute incompetence.

Fun fact: I honestly dont know is Co-Pilot is utter trash since I have NEVER used it!

I actually would be more incentivized to use it if MS didn't insist on shoving it down our throats.

There are unintrusive ways to get people to try it out.

I honestly have NO IDEA how Co-Pilot works and frankly MS has given me no incentive to care.

 

[j0hnnix]

When shareholders run a tech company tonight on dateline.

 

[Skifi28]

Papito let people enjoy this "gaming" news.

Didn't Microsoft itself specifically blame gaming? This is a first as far as I'm aware.

 

[Fake]

Microsoft loses $357 billion

Phil Spencer:

 

[HYDE]

If Satya was thinking of killing / jettisoning Xbox this has magnified it ten fold.

That's some pony looking bait.

 

[Chuck Berry]

Papa Phil right now:

Out of all of the constant fuck ups he's done, you really think he's sweating over this?

 

[Plague Doctor]

How many more years can they prop up this leadership? They've been a failure since the xbox one reveal and they never really recovered.

This is the definition of insanity,

 

[bighugeguns]

How many more years can they prop up this leadership? They've been a failure since the xbox one reveal and they never really recovered.

This is the definition of insanity,

Are there any leaders in the gaming industry that don't instantly capitulate to culture war bullshit?

Shit, it's time to call Pete Hines.

 

[Sethbacca]

Feeling pretty good about my prediction thread call for MS to drop hardware this year right now.

 

[OmegaSupreme]

Papito let people enjoy this "gaming" news.

It's okay. They're failing big time there too

 

[LordCBH]

Satya should just ask copilot to find the gains. Copilot NEVER lets anyone down!

 

[DeepEnigma]

That's like what $10 - $20 to them ?

Don't worry, they'll open up that War Chest™ and bail gaming out again.

 

[PauloRoberto]

Let's just see... during the investor call, the company CFO publicly and officialy put the blame of weak numbers into gaming division (among other divisions, of course)... and there are still zealots trying to convice themselves that the problem is NOT on the gaming division ?! What are you, idiots ?!

 

[jm89]

When that AI bubble pops it's gonna take MS with it.

 

[Tajaz2426]

Xbox division about to be a tax write off.

 

[Kenneth Haight]

 

[bighugeguns]

Only Todd Howard can make Xbox more profitable than Apple, but the cost in lives might be too much to bear.

 

[DR3AM]

This is nothing, the market fluctuances all the time. In 3 months, MSFT stock will bounce back, and people will not post anything positive about MS.

 

[BigBeauford]

Incredible news. It's going to be painful in the short term but if enough people continue to reject big tech's efforts to feed us all into the AI wood chipper, our kids and grandkids might have a chance.

 

[twilo99]

Microsoft is finally dead!