Microsoft executive touts Copilot traction after analyst pressure
FILE PHOTO: Judson Althoff, CEO of Microsoft’s business division, appears during an interview in San Francisco on January 27, 2017.
David Paul Morris | Bloomberg | Getty Images
Microsoft After facing criticism for relatively low adoption in recent months, the Copilot AI add-on is making greater progress with sales to commercial customers, executive Judson Althoff told employees on Thursday.
Software stocks, including Microsoft, have tumbled this year on fears that generative AI models could increase competition. Microsoft, whose shares fell 23% in the first quarter, has increased spending on data centers for cloud customers like OpenAI, and investors are looking for signs that products developed with artificial intelligence models will boost revenue and profitability.
In January, Microsoft said it had collected 15 million seats for Microsoft 365 Copilot, which sits above its commercial productivity software subscriptions, with standard packages representing 3% of its seats. Microsoft 365 enterprise users have access to a limited-featured Copilot Chat assistant. CEO Satya Nadella told analysts on an earnings call that the company has “a lot more enterprise chat users.”
The $30-per-month Microsoft 365 Copilot became widely available in 2023, and many analysts have since noted that adoption is still in its infancy. UBS analysts, who recommended buying Microsoft shares after the announcement in January, said that they expected more subscribers.
Althoff, the CEO of the company’s business business, said at a town hall meeting that resellers tried to get paid Microsoft 365 Copilot seats and get everyone else to use Copilot Chat, but Althoff, the CEO of the company’s business business, revamped its strategy after receiving feedback from analysts about the results, according to a transcript reviewed by CNBC.
Microsoft had no immediate comment. Bloomberg He had made these statements before.
Althoff said he and Microsoft finance chief Amy Hood set bold targets for the March quarter that ended Tuesday.
“Those were shot in the third quarter,” Althoff said.
The company has set new and ambitious targets for the June quarter.
“I’m actually very confident in these numbers,” he said.
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