Key Takeaways
- Microsoft’s Foundry product for AI agents has missed last year’s sales targets, which will be lowered in the future, according to a new report.
- Microsoft refutes the report, claiming it has “not lowered sales quotas or targets.”
- The report claims less than a fifth of salespeople at one Azure unit hit their sales target of 50% growth.
Several divisions at Microsoft have recently lowered sales quotas for some artificial intelligence products, according to a new report from tech publication The Information.
These cut backs in AI sales growth targets are the result of missed sales goals for the fiscal year that ended in June, according to the report, which cites salespeople in the Azure cloud unit.
The company has bet heavily on AI technology in recent years, so this news could be considered a sign of a cooling interest in AI tech, if it’s true. According to CNBC coverage, though, Microsoft holds that it has not lowered sales targets.
Microsoft’s Foundry Product Missed Sales Targets, According to Report
The Information cites two separate Azure cloud salespeople. The claim? Microsoft’s Foundry product, which helps build and manage AI agents, missed its sales targets for the last fiscal year, and targets will be lowered moving forward.
At one US Azure unit, fewer than a fifth of salespeople were able to reach the Foundry sales target of 50% growth, the Information says.
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However, Microsoft says otherwise. In a statement to CNBC — following a 2% dip in stock performance in response to the Information’s report — a Microsoft spokesperson said “the company has not lowered sales quotas or targets for its salespeople.”
Microsoft’s AI Investments
Microsoft bet early on OpenAI, the company behind the biggest brand in large language models, ChatGPT, which has been making headlines since it first launched in 2022.
It also made investments in alternative models, including a multi-million-dollar deal with French tech startup Mistral AI last year.
Now, if reports of the company pulling back on AI sales targets prove true, it might be lowering its ambitions. The big unanswered question that this news raises — assuming the report can be confirmed — is whether this indicates that AI popularity has now peaked and will continue a decline as we head in 2026.
Sign of an AI Bubble?
This news is not the only sign that we might be in an AI bubble that’s about to pop, as some tech players have predicted.
First, there’s an MIT study, released earlier this year, which found that a full 95% of commercial AI projects do not advance after completing their pilot stage. Last month, tech magnate Peter Thiel dumped his entire holding in AI chip manufacturer NVIDIA.
None of these facts are a smoking gun by themselves, granted. But they can all be considered warning signs that the AI tools currently propping up the stock market might not be able to live up to all their promises.
