Microsoft trims AI software sales targets as buyers resist new offerings, The Information reports
A man checks his phone in front of the Microsoft logo during the 2025 Mobile World Congress (MWC) in Barcelona, Spain, on March 3, 2025. REUTERS/Albert Gea Purchase Licensing Rights, opens new tab
Dec 3 (Reuters) - Several Microsoft divisions (MSFT.O) have reduced growth targets for certain artificial intelligence products after many sales teams missed their goals in the fiscal year that ended in June, The Information reported on Wednesday.
The report notes it is uncommon for Microsoft to lower quotas for specific products, citing two salespeople in the Azure cloud unit.
Shares of Microsoft, one of the biggest beneficiaries of the generative AI surge thanks to its early involvement with OpenAI, fell more than 2% in premarket trading. The stock has risen about 16% this year.
Microsoft did not immediately respond to Reuters’ request for comment.
Lowered sales-growth ambitions for Microsoft’s AI offerings may amplify concerns about real-world adoption of AI, reinforcing an MIT study from earlier this year that found only around 5% of AI initiatives progress beyond the pilot phase.
U.S. tech giants face investor pressure to demonstrate that their hefty AI infrastructure investments are delivering returns.
Microsoft disclosed a record capital expenditure of nearly $35 billion for its fiscal first quarter in October and warned that spending would climb further this year. Across the sector, U.S. tech giants are expected to spend roughly $400 billion on AI this year.
Executives have said the outlay is essential to overcome supply constraints that have limited the ability to capitalize on AI demand.
Microsoft projects that AI capacity shortages will persist at least through the end of its current fiscal year in June 2026.
Reporting by Jaspreet Singh in Bengaluru; Editing by Arun Koyyur
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