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Satya, what brings you here to Germany?

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You know, it's our AI tour today in Munich
and I'm excited to be here. Is it

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more difficult these days to come here and

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be in Germany and answer questions? Not
really. I love it. I mean, it feels like

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the atmosphere has changed a little bit.

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There's more skepticism. There's some
governments in Europe even thinking about

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only allowing European tools.
There's even a supermarket giant that's

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developing their own cloud. Well,
I mean, look, you know, first of all, I

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think there is real reason for why
there is competition always. So, there is

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local competition, there is multinational
competition and we welcome

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that and I think what Germany and what

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Europe deserves is great innovation both
coming out of this region and from the

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rest of the world because in fact, when
I look at Europe and look at Germany, in

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fact, I I always describe it, you know,

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whenever I'm in a jeweler in the United
States or when I'm at the dentist, I see

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the German Mittelstand and its excellence.
And so, the world I think

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will remain a connected
world where the innovation

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from any region reaching the other
regions is going to be the true sign of

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progress. But you but you sympathize,
you can understand that some German or

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European companies are a little worried
these days? I mean, I first of all, I

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think that any country should sort
of think about how should they think about

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their own innovation agenda, their own

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competitiveness, their own sovereignty.

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That's the topic of the day today. And I

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talked about this even today in my talk,
which is how one can take all the

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options. So, for example, if you look at
it, right? We are definitely an American

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company, we're a multinational company,

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but we have significant capital that we

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have invested in Europe, in Germany,

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putting our capital at risk so
the German companies can use it and then

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create more value, right? So,
it's not like we're coming here with just

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software. We have both innovation and

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investment here and locally. And we have
all the sovereign options, right? You

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have the ability to manage your own keys,
you can encrypt your data, you can

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have confidential computing, you can
even have private cloud options. And we

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have even local partners. And so, in some
sense, I think as long as one takes

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the approach that, "Look, at the end of
the day, if you want to manage risk, you

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manage it using a portfolio
like everything else in life."

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Um and then to be able to think about
it in clear ways and say, "At the end of

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the day, Germany needs to have
sovereignty and also produce things out

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of Germany that get exported around the
world, and we can be a great partner for

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that." All right. Um maybe briefly on

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your career. It's amazing. I mean, you

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when you started as CEO 2014, um

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the company was 10 times less valuable

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than today, and you I think increased

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the revenue by factor of five or six.

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Amazing numbers. How?

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Look, look, at the end of the day,
um what matters the most is what happens

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next as opposed to what happened in the

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past. And if I sort of had to recount

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how is Microsoft, not just in my
tenure or whatever, 12 years, but

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what's the real question is, what is it

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that after 50 years after our formation,

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here we are in 2026

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uh and going at it. Um and the

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fundamental thing to me is having that

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sense of purpose and mission that allows

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us uh to be relevant going forward and a

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culture that allows us to build
a capability, right? Even take the the

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thing that we're talking about in AI.
It was back in what, 2019, 2018, when we

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decided that there was going
to be essentially a new regime

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uh of AI innovation and see it long
before it's conventional wisdom.

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Is it true that you invested in OpenAI
in 2019, I think, for the first time?

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And Bill Gates was not a big fan of that.

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>> I mean, I think we've
Bill has talked about it,

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I've talked about it uh you know,
externally. And it is I mean, after all

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that, you know, who would have thought
in 2019 that it is a smart idea to go

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put a billion dollars, right? Everybody
thought we were just burning a billion

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dollars. And so, you know, it turns
out some of these things when they work,

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they are celebrated and when they don't
work, nobody knows about it. And so,

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therefore, look, at the end of the day,

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I'm more like the thing that we were

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obsessed about, and Bill in particular
was obsessed about, was natural

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language, right? I mean, throughout
our history from the beginning days of

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Microsoft Research was can we really
have AI breakthroughs in natural

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language? And so, when the OpenAI
team started pivoting from

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what at that time they were doing
a lot more RL and and what have you, it

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interestingly enough they switched
to natural language and scaling laws.

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And that's when we sort of picked it up
and and rest is history. I mean, that's

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the legend that you met Sam Altman
at Sun Valley at the conference.

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What did you see in him after the first
meeting that in the end made you would

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make this investment? You know,
I've I've known Sam for a long lot longer

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than that. I met him, you know, maybe
in you know, when he was in his first

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startup. And so, it's not that I ran
into him in Sun Valley for the first

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time. So, I've known
Sam for a long time. And

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and quite frankly, some of the other
founders of OpenAI and what have you.

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And I think I mean, fundamentally,
interestingly enough, I think the paper

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that was originally written there
was even written by I think Dario

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when he was at OpenAI on scaling laws.

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And so, you know, look, I think it's
fantastic team they assembled. They had

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real belief in scaling.

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They And then we thought that we can be

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great partners. And so, and we went all

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in and it's been great for them and for

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us. Are you sometimes concerned we
are still in an AI bubble, though?

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You know, look, I think it's
at the end of the day, there's only

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thing one thing that matters, right?

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Which is it's not about talking
endlessly about the technology. It's

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about seeing that technology in the real

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world having real impact, right? I come

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here to Munich and I sit and sort of

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listen to a startup out of Munich
that's building one of the world's best

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customer experience. Perloa,
right? Which is fantastic to see

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they're building they're winning share,

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right? That's great to see talking about
German innovation which is not obviously

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born in Germany but winning world over

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and they are partnering with us. Or they

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go the other extreme and say

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you see the Munich fire department using

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AI to get better at their emergency

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transfers. Right? To me the bubble is a

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bubble if you don't have these examples
of diffusion. I give you an example of

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when I thought it might be
a little bit over hyped. Um

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the third most the three most important

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German companies SAP one of them

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Deutsche Telekom and Siemens they're all

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together less valuable than open AI's

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these days. Is that real? Well, I mean
I think at the end of the day there is

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going to be more of a broadening

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of the economy. In fact, if anything the

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in the fullness of time right if what is

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AI going to do? AI is going to do two
things. One is if you think about it

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it's a real physical investment, right?

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After all you brought up Siemens, right?
I think Siemens is going to be one of the

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largest suppliers of a lot of the
equipment that goes into data centers.

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So, I think Siemens is going
to be a major beneficiary

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of what is going to be the build out
of AI not just in Germany but world over,

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right? And so there is going to be
and energy is going to be a massive

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requirement. So, I think there's going
to be a broadening of the supply side of

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it. Then on the demand side, right?
As it gets used it's going to create

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surplus. It's going to create local
surplus whether it's in the health

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outcome or whether that in the public
sector efficiency or what have you. So,

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ultimately there should be and will be
GDP growth, right? That's the real test

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for any of this. >> valuations
are staggering. Valuations

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are look, at the end of the day, you know,
stock markets work because people

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are really looking at what the forward
earnings potential of anything is and

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it's sort of like, you know, in the
short run it is what is it that Warren

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Buffett thing, right? Which is it's a uh
voting machine and in the long run it's

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a weighing machine and I'm not going
to comment on uh stock prices and

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valuations. That's for investors to make
sense of, but what I think of is an all

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up economy benefits from new general

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purpose technologies lifting all boats
when it comes to productivity and this

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is what's happening. Do you think
there's like some new breakthrough

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innovations in AI? Is there something
after the transformer models on the

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frontier already? Yeah, I mean it's it's
a good great question, right? When I I

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think about even it's
not no longer just one

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transformer model. I mean, if you look
at you know, where we've got it is all

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about pre-training scale, then we it
was about post-training, then we came up

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with reasoning, uh then we said, "Oh,
there's RL." Uh and so there's constant

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innovation um that's
happening even in what is

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considered transformers and transformer
architectures. Uh there is obviously

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going to be I always say that we are one
sort of innovation away from the entire

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regime changing even uh
in terms of what's a new model

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architecture that could even be more
efficient uh in its performance. And so,

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I think we have to be very open-minded

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about it. I brought three 5 years out

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questions. The first one is, in 5
years out, will there be vast amounts of

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people without a job? I think

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it's going to be

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one of the biggest questions for us is

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how does work work artifact and workflow

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change? So, let's take software
development, right? Because after all

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this is the place where it all started,
right? In fact, my own belief in this

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particular transformer models and its
scaling properties was, you know,

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reinforced when I saw next edited
suggestions in GitHub Copilot.

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Um if I look at what's happening
with software development, right?

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A- Any If In fact, if you look at even
the history of software development,

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right? You know, at least, you know,
I started learning with assembly and then

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compilers came and then we went
to higher-level languages, we went to

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interpreted languages, and we've had,

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you know, many, many tool chain changes
and levels of abstraction that made us

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more productive. This one is a another

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big leap forward in making it possible

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for both reducing the floor and raising

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the ceiling for anyone who's a software
developer, right? What does it mean

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reducing the floor? Anyone can be
a software developer, just like how Excel

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reduced the floor for anyone to be
an analyst. Now, anyone can be a software

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developer. But, it's also raising the

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ceiling on Oh, what is the new

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sophistication you need in order to be

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productive with these new tools,
so that these code bases that are getting

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generated are not black boxes. That's
going to be what all of us will have to

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reskill ourselves on. So, to me, what
I think is more important in the short

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run. I'm not saying that there is not
going to be displacement. We have to be

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clear-eyed about it. What's the best

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protection against displacement? It's to

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one understand the new medium, the new

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tool, the new skills required,
and transform yourself in job. And that is

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what's happening in software
development, and you can see it where

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software developers are getting more
productive, the IT backlog is huge.

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>> I I I totally buy it
for for the software developers

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bubble or the that industry.
But, I mean, there's talk about like

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whole economies. But, let me say this,
right? If somebody in in the early '80s

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had come to us and said, "3 billion
people, 4 billion people are going to

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get up every morning and type.

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And we would have said, "Why?" Right?

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You know, we have a typist pool and we

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have a slide pool. Why would 4 billion

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people type? We invented this entire

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thing called knowledge work. Uh and so,
I think at some level, I'm not like

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being Pollyannic about this, but I'm

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saying let's at least have a bit of

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optimism in our ability as humans and

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human societies uh and as political
economies, right? One thing that is

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discounted is like we have control.
It's called political economies and

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elections, and people are not going to

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tolerate anything that is not going to

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be beneficial at society scale. And so,

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I'm a big believer that the what is the
real governor? It's just not going to

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happen to us. We're going
to shape what happens to us.

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>> No, it's it's going to be difficult.
I mean, if this if the disruption happens

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fast, I mean, we're up for huge
challenges. I mean, if this unemployment

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really comes, it's going
to be challenging. For sure,

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if unemployment suddenly comes, it's
going to be challenging. And so, that's

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where I would say let us all focus on

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making sure that we are doing all the

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things uh to help us skill ourselves

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such that we have more economic
opportunity with what is going to be uh

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the new productivity curve. >> So,
but you do not afraid of like huge

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waves of unemployment. I I I am afraid

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of anything that is going to not help

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human societies uh really make progress,
right? So, anytime anyone gives me a

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dystopian worldview that we are all
going to be unemployed, of course, I'm

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afraid of it. Uh but I'm also saying I'm

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not so out of control of it. Like we all

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as a you know, as a society get to sort

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of make sure that the technology we

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build and how it diffuses, what happens

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to wages, how we litigate what expertise

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we will reward and not reward. There's

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so many things uh that we are have
control over that we should not abdicate

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all that. Um next five
years question. Um do you

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think Germany will still be a top three
market for Microsoft in the next 5 years?

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I mean, I I definitely hope so. I mean,
to me, you know, what has stood out and

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made Germany unbelievably
successful in the world is

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the German ingenuity, the German
engineering, and its ability to produce

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things that the world needs and the

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world wants. And so, if anything, I

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think that industrial base that Germany
has now coupled with even the digital

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capability. In fact, I always feel,

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again, to my middle start example, why

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not think of, you know, now all this

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digital data, right? And the exhaust
of digital data coming back from

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everywhere, being,
again, translated into the

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intelligence layer that goes with the
Siemens equipment, right? One of the

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things that we're working with Siemens
are all the digital twins and the

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intelligence layer in the digital twins.

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Do you talk to German leaders regularly?

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Absolutely. Like, who do you talk to?
I mean, I talk to Ronald at Siemens, I

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talk to Ola at Mercedes, I talk to Ingo,
I'm going to talk to many play people

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today. And so, yeah,
I'm definitely in contact with

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uh, German CEOs all the time. Do you

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think in the next 5 years, um, Microsoft

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will still rely heavily
on revenue from Office and Windows?

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You know, when we say
rely on Windows Office and

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and Windows, it's fascinating. What
is Office, right? I mean, if I asked you,

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right, the question, Office,
when we started, people bought

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Office clients. Then they
bought servers. And when it

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came to the cloud, they literally kind

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of bought really data,

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uh, and the data storage and the sharing
and collaboration. And so, there is no

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such thing as even what is Office.
It has gone through

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both business model transformation,

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value transformation, right? And so, I

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look at even our, quote-unquote

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in fact in the agent world. Like the
first thing people are doing for agents

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is provision office for it.
Because agents need to collaborate, need

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to be able to collaborate with humans.

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And what's the best way to do it in a
Teams channel to have access to email.

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Like when I want to have a co-worker,
my co-worker that takes my identity needs

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in some sense a separate office

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instance. And so, I think that one way
to think about is if it remains static

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in anything, of course that business
goes away. But when you think about what

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happens next, and this happened
to the cloud, right? We thought we had a

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fantastic server business, and we
thought the cloud will destroy the

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margins. It of course destroyed the

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cloud margins, I mean server margins,
but it expanded the market so massively.

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And I look at what's going to happen
with agents, and I look at that and say,

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"Wow, this is the best news if you
really are in the office business,

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because every agent will need office."

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You always seems like a such a >>
positive sunny guy and what you touch

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turns into gold, but I'm sure you had
to make some huge and and some very tough

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decisions in your life, in your business
career. What was the toughest one?

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Well, I mean at the end of the day,
you know, toughest calls are when you have

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to make redeployment calls that impact
people. I mean at the end, you know,

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that that's I think the hardest stuff.

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But in our case, when it comes
to business strategy, you know, let's, you

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know, call it what it is,
right? When we realized that

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when it came to the phone market,
we were too far behind, and we needed to

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pick where we focused our efforts,
and we picked the cloud. We always thought

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that the cloud as a control plane to go
across devices was more important, and

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that's why I mean even, you know,
making sure that Office was available

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everywhere and what have you. And so,
you know, those were tough decisions,

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but at the end of the day, I I I look
at this and say, "Look, at the end of the

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day for us, making sure we are looking

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at the future, irrespective of,
you know, what happens

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to us, we have to lean into it

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because we can't deny what is going
to be a secular shift. Any tech innovation

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that you'd still like
to see in your lifetime?

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You know, to me,

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my sort of dream would be the coming

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together of these um

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two things that we're working on, right?

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Quantum plus AI. And in fact, the

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juxtaposition of the two. Right?
One of the things we showed even

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at my keynote today was this model we

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built called GigaTime, which
basically, you know, does um

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a simulation uh of spatial
proteomics, right? So,

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it's it's it's a test that is used in

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immunothera- to check whether a

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particular immunotherapy can work for a

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particular cancer tumor. And today, it's

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an expensive test, and

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and so therefore, if we have a model
that really is in silico able to do that

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test, it's then going to be available
in every secondary hospital. Now, think

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about training that model, right?

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Training that model, a quantum computer
can do the best simulation. After all,

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we're trying to learn
the language of nature.

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And nature is quantum. And so therefore,

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a quantum computer will allow us to get

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training data to train AI models that

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then in silico can be much better at

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simulation of the real world, and that
will allow us to get more predictive

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power. Last question, how does a

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Microsoft CEO think about
longevity and how do you work out?

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Well, I get up try to get up every
morning irrespective of the jet lag and

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get to hit the gym. That's >> Every
morning? Every morning. For how

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long? About half hour.
Half hour, and that's it?

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>> That's it. And then you do pull-ups
and push-ups? Well, I mostly nowadays I'm

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like since my knees are no longer
in shape, I'm mostly doing incline walks.

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>> [laughter] >> Okay. Okay.
Thank you very much, Satya.

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Thank you so much. That's a pleasure.

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Let's go. LET'S GO.

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>> LET'S GO. >> [music]