Earlier this yr, Microsoft CEO Satya Nadella moved with haste to get engineers to check and deploy DeepSeek’s R1 mannequin on Azure AI Foundry. It was an unusually fast turnaround for a brand new mannequin on Azure that additionally set a brand new bar for achievement.
A couple of months later, Nadella then pushed to onboard xAI’s Grok 3 fashions, in a deal that noticed them arrive on Azure AI Foundry simply in time for the primary day of Microsoft’s Construct developer convention in Might. Elon Musk even appeared during Nadella’s Build keynote, in a considerably jovial dialog about his early days as a Microsoft intern — regardless of Musk making Microsoft a defendant in his lawsuit towards OpenAI.
I’m now listening to from sources accustomed to Microsoft’s AI plans that the corporate is taking a much more cautious method with onboarding xAI’s newest Grok 4 mannequin, after rapidly onboarding fashions from opponents like OpenAI, Meta, and Mistral.
Musk launched Grok 4 early final month, simply days after the Grok chatbot spewed out a sequence of pro-Hitler views on X. I’m informed that Grok’s Nazi sympathizing set off alarm bells inside Microsoft, simply as the corporate was making ready to launch Grok 4 on Azure AI Foundry. As a substitute of concurrently transport Grok 4 on Azure, like Microsoft does with most of OpenAI’s new fashions, there was no public announcement of when xAI’s new mannequin can be accessible via Microsoft’s AI companies.
I perceive Microsoft has been purple teaming Grok 4 all through July, a course of the place groups assault AI programs to seek out vulnerabilities or issues of safety. One supply described among the early purple workforce reviews for Grok 4 as “very ugly.”
As a substitute of launching Grok 4 to all Azure AI Foundry prospects, Microsoft is now engaged on a personal preview of the mannequin — simply as Grok hits the headlines once more for producing Taylor Swift nudes. This preview will solely be accessible for a handful of shoppers, I’m informed, as Microsoft desires to make sure Grok 4 is enterprise prepared.
I requested Microsoft to touch upon its Grok 4 plans for Azure AI Foundry, however the firm refused to offer an announcement that’s attributable to a named spokesperson.
Grok 4 availability on Azure AI Foundry is necessary to xAI, because it provides Elon Musk’s AI firm direct entry to Microsoft’s enterprise prospects. It’s equally necessary to Microsoft, as the corporate is eager to place itself as the AI mannequin internet hosting firm. Microsoft’s circumspect method with the Grok 4 preview means it’s unlikely that we’ll see xAI’s newest mannequin seem extra broadly on Azure AI Foundry anytime quickly.
Agent 365 is now an official Microsoft product
Microsoft introduced one other AI shake-up this week, affecting Charles Lamanna’s Enterprise & Business Copilot (BIC) groups. In June, the BIC workforce moved nearer to the Microsoft 365 Copilot aspect of the corporate, with Lamanna reporting as much as Rajesh Jha, Microsoft’s head of experiences and gadgets.
In an inside memo yesterday, Lamanna introduced some BIC management adjustments that can see Microsoft make Agent 365 an “official product initiative.” Agent 365 appears like a approach for Microsoft to deal with the challenges of AI agent safety and compliance whereas it scales these brokers throughout Groups, Outlook, and SharePoint. The Agent 365 initiative can be led by Nirav Shah, a 24-year veteran at Microsoft.
Microsoft can also be combining elements of its Energy Automate and Copilot Studio groups collectively. “Agent flows and CUA from Energy Automate will transfer to Copilot Studio underneath Dan Lewis,” says Lamanna in his memo. Another Energy Automate staff will now be a part of Microsoft’s Energy Platform workforce.
Lastly, the BIC workforce can also be creating “Microsoft Ahead Deployed Engineers (FDEs).” These are technical consultants who work immediately with Microsoft’s prospects to get them to activate AI merchandise. The FDE announcement comes amid Microsoft’s layoffs which have focused gross sales groups as a part of a broader restructuring effort to usher in extra technical salespeople to raised exhibit AI instruments to companies.
“Ahead Deployed Engineers are rapidly changing into important to giant scale AI transformations, as seen at firms like Plantir and OpenAI,” says Lamanna. “Simply as we’re altering the best way we do software program and product growth, Microsoft might want to undertake this new approach of delivering AI options to prospects.”
- Microsoft reviews robust cloud earnings, with Home windows and Xbox up, too. Microsoft’s earnings final week despatched the inventory worth hovering to the purpose the place it briefly grew to become the second $4 trillion firm. The higher-than-expected earnings included Microsoft reporting its Azure income for the primary time. Azure generated greater than $75 billion in income in the course of the 2025 fiscal yr. Xbox additionally had quarter, with content material and companies income up 13 % and general gaming income up 10 % yr over yr. Xbox {hardware} continues to be struggling, although, with {hardware} revenues down 22 % this quarter.
- Satya Nadella was good for his $80 billion. Earlier this yr, there was a number of doubt over the $100 billion in funding behind The Stargate Venture, and Nadella was fast to defend Microsoft’s personal funding in cloud and AI knowledge heart tasks. “I’m good for my $80 billion,” stated Nadella on the time. Microsoft is now spending $30 billion on its AI infrastructure investments subsequent quarter, which totals $120 billion over a yr if it retains that spending up every quarter.
- OpenAI’s new GPT-5 mannequin arrives in the present day. Microsoft-owned GitHub spilled the beans on GPT-5 somewhat early, simply as OpenAI teases a launch throughout a “LIVE5TREAM” at 10AM PT / 1PM ET in the present day. Count on to see 4 new mannequin variants, with “enhanced agentic capabilities” and the power for GPT-5 to deal with “advanced coding duties with minimal prompting.” If GitHub is prepared with GPT-5, then you possibly can guess that Copilot and Azure AI Foundry may also be prepared with GPT-5 later in the present day.
- Hey Microsoft, is it ‘Xbox PC’ or ‘Xbox on PC’? Microsoft has been utilizing the “Xbox PC” and “Xbox on PC” branding phrases not too long ago, and it seems to be like the corporate has lastly settled on Xbox on PC. It’s a brand new method to promoting that video games can be found on Microsoft’s Xbox app on PC, and a brand new technique to compete with Steam. The Xbox on PC branding isn’t too totally different from simply Xbox PC, nevertheless it’s a delicate change that makes it sound extra such as you’re getting Xbox video games on PC moderately than needing some type of Xbox PC {hardware}. Both approach, Microsoft nonetheless faces challenges convincing shoppers to go for Xbox video games on PC over merely shopping for them on Steam.
- Microsoft’s Home windows XP Crocs are not any joke. Microsoft has created limited-edition Home windows XP-themed Crocs primarily based on the basic Bliss wallpaper. They even include Clippy and Recycle Bin shoe charms. They’re at present accessible for Microsoft staff to preorder for $80, forward of a “worldwide launch.”
- Microsoft has an AI agent that may detect malware. Microsoft introduced Project Ire this week, an autonomous AI agent that may analyze and classify malware with out help. Developed by Microsoft Analysis, Microsoft Defender Analysis, and Microsoft Discovery & Quantum, Venture Ire is the primary agent at Microsoft to independently writer a conviction case “robust sufficient to justify automated blocking” of an APT malware pattern.
- Microsoft’s plan to repair the net with AI has already hit an embarrassing safety flaw. Researchers have already discovered a essential vulnerability within the new NLWeb protocol Microsoft made an enormous deal about only a few months in the past at Construct. NLWeb gives ChatGPT-like seek for any web site or app, however safety researchers have found an embarrassing flaw simply as Microsoft is deploying the brand new protocol with prospects like Shopify, Snowlake, and TripAdvisor. Anybody may learn delicate recordsdata, together with system configuration recordsdata and even OpenAI or Gemini API keys. Microsoft has now patched the flaw however is refusing to challenge a CVE, an business customary for classifying vulnerabilities.
- Microsoft makes OpenAI’s new open mannequin accessible on Home windows. OpenAI launched a brand new, free and open GPT mannequin earlier this week that may run on a PC. Microsoft was fast to make it straightforward to run on Home windows, with the light-weight gpt-oss-20b mannequin now accessible on Home windows AI Foundry. You’ll want a PC or laptop computer with no less than 16GB of VRAM, and the gpt-oss-20b mannequin is optimized for code execution and gear use. Microsoft says it’s “excellent for constructing autonomous assistants or embedding AI into real-world workflows, even in bandwidth-constrained environments.” Microsoft can also be engaged on a macOS launch.
- Nvidia will assist GeForce drivers on Home windows 10 till October 2026. Microsoft is ending assist for Home windows 10 in October, however Nvidia is dedicated to proceed releasing its new GeForce Sport Prepared drivers till October 2026. That matches the yr of prolonged safety updates that Microsoft will provide shoppers, and can guarantee Home windows 10 customers proceed receiving the newest optimizations for brand spanking new video games and apps.
- Bing made Google dance after which stole some search visitors. Microsoft CEO Satya Nadella needed to make Google dance two years in the past, with an AI overhaul of Bing that was designed to steal Google’s all-important search market share. Now, there are many indicators that Microsoft has efficiently taken search share off Google, each within the US and worldwide. Comscore and Statcounter each be aware that Bing has elevated its search share by a small share on desktop. That might imply Microsoft’s methods to maintain folks utilizing Edge and Bing as defaults are having an influence on its search share.
- Microsoft is ending Home windows 11 SE, its ChromeOS competitor. Microsoft is ending assist for Home windows 11 SE subsequent yr, 5 years after it launched the working system on low-cost laptops that have been designed to compete with Google Chromebooks. Home windows 11 SE was solely accessible on gadgets for faculties, nevertheless it was designed to maintain Microsoft’s schooling prospects from switching to ChromeOS. As demand tails off for Chromebooks, Microsoft isn’t chasing Google’s low-cost laptops fairly as onerous because it as soon as was.
- 8BitDo’s first wi-fi Xbox controller is a shock Uncommon collaboration. I used to be shocked to see Xbox recreation studio Uncommon workforce up with 8BitDo, and never Microsoft, for a particular anniversary version Xbox controller. The formally licensed controller contains a gold and blue design, with loads of Easter eggs to have fun Uncommon’s fortieth anniversary. It’s additionally 8BitDo’s first wi-fi Xbox controller, with a small USB dongle and never Microsoft’s native Xbox Wi-fi protocol.
- Microsoft’s Black Hat-like hacking occasion returns with greater rewards. Microsoft’s hacking occasion, Zero Day Quest, is back and accepting nominations till October 4th. This yr there may be as much as $5 million in bounty awards, up $1 million from final yr. Microsoft is even providing multiplied bounty awards for locating probably the most essential points in merchandise like Azure, Copilot, and Microsoft 365. Safety researchers may also get an opportunity to qualify for a dwell hacking occasion at Microsoft’s headquarters in spring 2026.
- Microsoft is bringing its Xbox Copilot to the Home windows Sport Bar. Microsoft began testing its Xbox Copilot on iOS and Android earlier this yr, and now it’s bringing the chatbot to the Sport Bar characteristic on Home windows 11. In case you’re a part of the PC preview for Xbox options, now you can begin testing a brand new Gaming Copilot widget for the Sport Bar. The Gaming Copilot is aware of what video games you’re taking part in and might take screenshots to reply questions, and it’s an early step in Microsoft’s broader imaginative and prescient to show its Xbox Copilot into an AI gaming coach.
- Microsoft’s 2030 imaginative and prescient for Home windows is all about AI. Microsoft quietly launched a brand new YouTube sequence on its Home windows channel earlier this week, discussing the corporate’s imaginative and prescient for Home windows in 2030. The first in the series options David Weston, vice chairman of enterprise and OS safety at Microsoft, who predicts “the world of mousing and keyboarding round will really feel as alien because it does to Gen Z [using] MS-DOS.” Microsoft has already began pushing AI brokers inside Home windows 11, and I’m solely anticipating the tempo of AI change in Home windows to speed up over the subsequent 5 years.
- Microsoft tries to maintain its client Copilot out of New York Instances AI copyright case. Microsoft is attempting to argue that its present model of Copilot for shoppers should be excluded from legal discovery within the copyright lawsuit filed by The New York Instances. Microsoft argues its newest model of Copilot “didn’t exist on the time Information Plaintiffs filed their complaints” and “is constructed on a special platform with new system structure.” Copilot nonetheless makes use of the identical core OpenAI fashions, although, and that’s precisely what legal professionals for the NYT are arguing.
- Microsoft’s knowledge heart technique continues to be in pause mode. There have been a number of reviews of Microsoft pausing knowledge heart builds over the previous six months, alongside leasing freezes. Now, SemiAnalysis reports that Microsoft’s dedicated knowledge heart building is down yr over yr, and that “nearly no new leases have been signed up to now 12 months.”
- The Home windows Vista boot sound bug in Home windows 11 builds has been mounted. Microsoft unintentionally swapped Home windows 11’s startup sound with Vista’s in current take a look at builds of the working system. That is now mounted within the latest Canary builds of Home windows 11. It’s a disgrace, as a result of I really desire the Vista boot sound.
I’m all the time eager to listen to from readers, so please drop a remark right here, or you possibly can attain me at [email protected] if you wish to talk about the rest. In case you’ve heard about any of Microsoft’s secret tasks, you possibly can attain me by way of e-mail at [email protected] or communicate to me confidentially on the Sign messaging app, the place I’m tomwarren.01. I’m additionally tomwarren on Telegram, for those who’d desire to talk there.
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