Microsoft’s AI reset is bigger than Copilot

Hello,

Microsoft is trying to prove its AI strategy is worth the cost.

The Copilot reset

The $3.8 trillion question

At the same time, The Information’s analysis suggests Microsoft’s real value could be closer to $3.8 trillion, or roughly $500 a share, if its software, cloud and personal computing businesses were valued against comparable peers.

The enterprise AI fight

Microsoft’s challenge now goes beyond building better AI tools. It is trying to defend its enterprise software empire as OpenAI, Anthropic and other AI challengers push to become the main interface for work. That is why Microsoft is opening Teams to outside AI agents, supporting new agent software standards and rethinking how Copilot fits into the workplace.

The Xbox retreat

The pressure extends beyond AI. The Information has also reported that Microsoft has considered restructuring or spinning out Xbox, while pushing for more investment in major franchises like Halo, Fallout, Elder Scrolls and Minecraft. Now, with Microsoft cutting jobs and retreating from parts of gaming, Xbox has become another test of how the company will protect growth, margins and long-term value.

The Information is already inside the story, tracking the internal decisions, competitive pressure and investor questions shaping Microsoft’s next chapter before they become obvious to the broader market.

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