After a 12-year stint as Microsoft CEO marked by growth and market leadership unrivaled by any CEO in any industry, Satya Nadella appears to be paving the way for his next role at Microsoft in what will very likely be a replica of Larry Ellison’s role at rival Oracle: chairman and CTO.
While this is unquestionably conjecture on my part, I think it deserves to be considered informed speculation for a variety of reasons, not the least of which is his Oct. 3 LinkedIn post that came two days after Nadella disclosed he is divesting a massive portion of his CEO responsibilities by naming Judson Althoff CEO of Microsoft’s commercial business.
Now, maybe I’m reading into this more than is there, and while there’s no question that Nadella’s a geek at heart — well, a geek with an extraordinary gift for business strategy, leadership, vision, and financial insight — this “Friday evening reflection” from the CEO of one of the world’s most-valuable companies strikes me as someone who revels in “AI WANs” and “optical fiber footprints” every bit as much as lengthy proclamations on shareholder value and business transformation.
Friday evening reflection: Adjusting my cloud infra priors for the AI era… a colleague just shared the progress we are making with our AI WAN. In one project, we expanded our North American optical fiber footprint by 40% and added network capacity equal to one-fifth of our entire global network – a network that took 15 years to build now takes months!
At 58 years of age, Nadella has spent way more than half of his entire life at Microsoft (he joined in 1992) and has guided the company to a market cap of almost $4 trillion while making it by far the world’s largest cloud-computing vendor. In its fiscal Q4 ended June 30, Microsoft reported cloud revenue of $46.7 billion, along with RPO of $368 billion.
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And it certainly appears that Nadella wants to leverage those achievements and the extremely strong financial foundation he’s created for Microsoft by devoting the vast majority of his time to technical pursuits, much as Larry Ellison did in 2014 when he handed over the CEO role to Safra Catz and Mark Hurd and became executive chairman and CTO.
Beyond Nadella’s lovably nerdy “Friday evening reflection” noted above, here’s what Nadella had to say in Microsoft’s public disclosure of the changes at the top, which came in a blog post headlined “Accelerating our commercial growth“:
We are in the midst of a tectonic AI platform shift, one that requires us to both manage and grow our at-scale commercial business today, while building the new frontier and executing flawlessly across both.
History shows that general purpose technologies like AI drive step changes in productivity and GDP growth, and we have a unique opportunity to help our customers and the world realize this promise.
Our success depends on enabling commercial and public sector customers and partners to combine their human capital with new AI capabilities to change the frontier of how they operate. To accelerate this, we will increasingly need to bring together sales, marketing, operations, and engineering to drive growth and strengthen our position as the partner of choice for AI transformation.
With this context, I have asked Judson Althoff to take on an expanded role as CEO of our commercial business.
Inside Nadella’s Decision
Again some conjecture, but — and I might be deluding myself here — I think it’s informed and reasonable speculation.
- Ensuring Microsoft harnesses that “tectonic shift.” In 2000, when Bill Gates stepped aside as CEO and took on the positions of chairman and chief software architect, Microsoft had little to do with hardware. But today, with Nadella recently showcasing Microsoft’s prowess at building and operating next-gen AI data centers, the range of the company’s technological ambitions goes far beyond software and deeply into the realm of the most-advanced hardware systems in the world in the face of wicked competition from Google Cloud and Oracle.
- Ensuring Althoff feels fully challenged and appreciated. As the global sales leader for Microsoft for almost the past decade, Althoff has not only generated outstanding numbers but has also become a highly visible executive who has no doubt had plenty of offers to join other tech firms as CEO.
- Reshaping the company to meet new market needs. In the announcement, Nadella noted in a couple of different places the urgent need for the huge company’s various teams and departments to work together more closely than ever before because Microsoft’s customers are moving more rapidly than ever before. In addition to the mention in the excerpt above, Nadella later said, “Additionally, Judson will lead a new commercial leadership team that brings together leaders from engineering, sales, marketing, operations, and finance to drive our product strategy and governance, GTM readiness, and sales motions with shared accountability for the rigor and executional excellence our customers expect.”
- Self-knowledge can be a wonderful thing. Thirty-three years at one company — even one as dynamic as Microsoft has been for most of that time — extracts a certain toll on any individual, particularly when the last 12 of those have been in the CEO hot-seat. And I’m guessing that Nadella knew that with Althoff able and willing to take on the lion’s share of the commercial side of the business, Nadella himself would be of greatest value to the company by focusing the vast majority of his time on Microsoft’s ongoing technological evolution and innovation. As Nadella said about the new arrangement:
This will also allow our engineering leaders and me to be laser focused on our highest ambition technical work—across our datacenter buildout, systems architecture, AI science, and product innovation—to lead with intensity and pace in this generational platform shift. Each one of us needs to be at our very best in terms of rapidly learning new skills, adopting new ways to work, and staying close to the metal to drive innovation across the entire stack!!
This isn’t just evolution, it’s reinvention, for each of us professionally and for Microsoft.
Final Thought
Just to be clear, Nadella is still Microsoft’s CEO, and my musings about a potential future role like the one Larry Ellison crafted 11 years ago — executive chairman and CTO — are pure speculation based on the scenarios outlined above.
But when I re-read Nadella’s “Friday evening reflection” and particularly his remark in the announcement about being unleashed “to be laser focused on our highest ambition technical work — across our datacenter buildout, systems architecture, AI science, and product innovation — to lead with intensity and pace in this generational platform shift,” I see a world-class executive who has rationally and quite enthusiastically determined that what is best for his company is also, at this point in his life and Microsoft’s, best for him.
So if, around July of 2026 as Microsoft wraps up its fiscal year, you hear that Satya Nadella has become executive chairman and CTO, don’t be too surprised.
AI Agent & Copilot Summit is an AI-first event to define opportunities, impact, and outcomes with Microsoft Copilot and agents. Building on its 2025 success, the 2026 event takes place March 17-19 in San Diego. Get more details.
