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In today’s big story, Microsoft’s “reinvention” due to AI means rethinking its structure. It’s not the only one.
What’s on deck:
Markets: Hedge funds’ September report cards are in.
Tech: Two BI reporters discuss if social media’s future could be silly AI videos of your friends.
Business: The best way to get an open job might be to get it before it’s an open job.
But first, ready for (AI) war.
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The big story
Big Tech’s big moves
Carlos Barria/REUTERS
“We are in the midst of a tectonic AI platform shift.”
Microsoft CEO Satya Nadella didn’t mince words when recently addressing employees about the state of the industry. And the tech giant is keen to move with it.
Case in point: Judson Althoff, Microsoft’s longtime sales chief, was named CEO of the company’s commercial business.
It shows how Big Tech giants are rushing to get their ducks in a row — particularly within their sales divisions — ahead of a critical (and expensive) fight over AI adoption.
(If you want to go even deeper on this type of stuff, I suggest you subscribe to Alistair Barr’s fantastic Tech Memo newsletter, out every Friday. No one is doing a better job of covering the business side of AI.)
So what exactly does Althoff’s promotion mean? He adds marketing and operations to his remit, allowing “our engineering leaders and me to be laser focused on our highest ambition technical work,” Nadella wrote.
In short: Let the sales guy figure out the business side of things while the rest of us cook up cool AI stuff.
Althoff, who already revamped his sales team to be more AI-centric, has his work cut out for him. BI’s Ashley Stewart, our resident Microsoft expert, heard audio from an internal meeting where employees complained about confusion over the multiple apps with the Copilot branding.
Nadella’s solution? Think big. Like, really big.
“The one way to make it less confusing is to have a billion users of each,” he said.
Amazon
Microsoft’s not alone in reshaping itself for the AI era.
Eugene Kim has reported extensively on Amazon’s efforts to get its AI products up to snuff. Q Developer, Amazon’s AI coding assistant, posted some disappointing revenue numbers compared to rivals in its first year.
Earlier this year, Q’s projected annual recurring revenue was $16.3 million, according to an internal document obtained by Eugene. That’s well behind rivals Cursor ($500 million) and Windsurf ($82 million).
That led Amazon to rethink its pitch to customers, opting for a more grassroots campaign that appeals directly to developers as opposed to hoping for a trickle-down effect by getting buy-in from high-level executives.
Pivoting companies with four-comma market caps isn’t easy, but they don’t have much of a choice. Wall Street is starting to get antsy. You can only tout huge growth forecasts during earnings for so long before you actually have to put up real numbers.
“This isn’t just evolution, it’s reinvention, for each of us professionally and for Microsoft,” Nadella said.
3 things in markets
Goldman Sachs
1. Step into Goldman Sachs’ Dallas office. The bank is investing heavily in its Texas presence, and the Dallas office, a home base for some 5,000 workers, will be its biggest outside New York. See renderings of the building, which will boast rooftop gardens, a dining terrace, and a fitness center.
2. Your September hedge fund report is here. Funds like Balyasny and ExodusPoint made money last month. But most couldn’t keep up with the S&P 500, which rose 3.5%.
3. Speaking of hedge funds, tea is being spilled at industry conferences. September was filled with an array of hedge-fund events held by some of Wall Street’s biggest players. From market woes to Bridgewater’s new fund, attendees told BI what all the chatter was about.
3 things in tech
Gobinath/Youtube; Getty Images; Alyssa Powell/BI
1. The most powerful Tesla executive you’ve never heard of. Ashok Elluswamy started as a founding member of Tesla’s Autopilot team in 2014. Now, as the team’s big boss, Elluswamy is front and center of the company’s most defining initiatives. BI spoke to more than a dozen of Elluswamy’s colleagues, friends, and former classmates to understand his rise.
2. Is OpenAI the new Amazon? OpenAI unveiled its new internal software-as-a-service tools this week, causing a massive stock sell-off in the space. It’s reminiscent of “getting Amazon’d” — when the grocery and pharmaceutical industries saw their market values get wiped out when the retail giant moved into their spaces.
3. The future is Sora. OpenAI’s AI video generator Sora 2 comes with potential copyright and privacy problems. It also lets you generate videos starring you and your friends, which makes it the most fun Katie Notopoulos has had on the internet in a long time. In fact, it might even be the future of social media.
3 things in business
Getty Images; Tyler Le/BI
1. An online army is waging a culture war against US troops. Trump vowed to banish “woke” from the armed forces, and the White House has said that mission has boosted morale and recruitment. Twenty-four active-duty and recently retired troops told BI it’s stirred up paranoia and challenged the military’s nonpartisan ethos.
2. How the government shutdown could affect you. If you’re on Social Security, your payments won’t stop, although you might notice some delays in other services. Post offices will be open, but national parks are touch-and-go. And since October’s jobs report most likely won’t be landing on time, here are some alternative sources of data.
3. The secret to getting a job could be pre-applying. Connecting with an employer before they post an open role could help you land a job there, veteran recruiter Laura Labovich told BI. In fact, if you wait to reach out until the job posting is live, she said, you might be too late.
In other news
What’s happening today
- Tesla reports Q3 production and delivery numbers.
- It’s Yom Kippur.
Dan DeFrancesco, deputy executive editor and anchor, in New York. Meghan Morris, bureau chief, in Singapore. Akin Oyedele, deputy editor, in New York. Grace Lett, editor, in New York. Amanda Yen, associate editor, in New York.
