During his decade as CEO, Satya Nadella has transformed Microsoft from a struggling tech giant into the world’s most valuable company, with a market cap exceeding $3.1 trillion. Throughout his 32-year tenure at Microsoft, Nadella has witnessed four major technology platform shifts—PCs, the web, mobile, cloud computing, and now AI. He understands how the company struggled to compete during some of these transitions, which may explain the sense of urgency and slight paranoia he conveys in Fortune’s latest cover story by Jeremy Kahn.
As Nadella remarked to Jeremy, “When the paradigm shifts, do you have something to contribute? Because there is no God-given right to exist if you don’t have anything relevant.”
With Microsoft’s partnership and over $13 billion investment in OpenAI, Nadella has positioned the company as a leader in the AI era. (The Microsoft Build developer conference starts tomorrow and is expected to highlight several major AI-driven upgrades.) However, as Jeremy notes, the alliance with OpenAI also carries risks, as evidenced by the recent turmoil when OpenAI’s board fired and then reluctantly rehired CEO Sam Altman. The departure of researchers Ilya Sutskever and Jan Leike also raised concerns, particularly as it led to the disbanding of a team focused on ensuring the safety of future advanced AI systems. Additionally, numerous competitors are entering the AI race.
Nadella is acutely aware of these risks, having experienced the Microsoft antitrust case in the late 1990s that required the company to open its Windows operating system to competition after being found guilty of attempting to monopolize the browser market. This history may have influenced the recent decision to separate the Teams videoconferencing app from Office software, though the looming threat of EU antitrust action was likely a more significant factor. He has seen Microsoft make unsuccessful bets on media players, cell phones, tablets, and other technologies. He notices when customers shift even a small part of their business to competitors.
Nadella is particularly attuned to public scrutiny, telling Jeremy that what keeps him up at night is the fear of Microsoft losing its “license to operate”—which depends on maintaining public trust by being a positive force in the communities it serves. Upholding this license involves investing in local economies, as demonstrated by recent announcements in Asia. It also means striving to meet Microsoft’s 2030 goal of becoming carbon negative, even as its AI initiatives have increased CO2 emissions by 30% since 2020. Throughout his leadership, Nadella has focused on fostering a culture that is humble, hungry, and ready to grow.
